The Board continued the Phase II discussion on Business Combinations by going through the principal decisions made to date and clarifying the wording in the summary document presented by the staff.

The staff tentatively indicated that a draft exposure draft could only be expected at the end of the fourth quarter. This was tentative, as staff were still to meet with the FASB staff to set out the work plan.

An indication was requested of Board members intending to dissent on the exposure draft. Five Board members indicated that they would dissent, principally for the following reasons:

• The full goodwill approach taken by the Board contradicts the Framework as that portion attributable to the minority interest does not meet the definition of an asset. In addition, the recognition criteria for an asset require the measurability of an asset to be reliable. The dissenting Board members indicated that this was not the case for goodwill, which is in principle a residual amount. Furthermore, any impairment write offs of such goodwill would be taken through the income statement of the entity and thereby affecting the minority's interest in the results of the entity. Cost/benefit concerns of the full goodwill approach were also raised.
• The accounting for transactions with minority interests has not been fully explored, and the disclosure requirements in this area are insufficient.
• The step acquisition provisions agreed to by the Board.