Identifiable net asset (INA) or goodwill
2. Business Combinations
(GW)?
1. Property, plant and equipment of the acquired company at fair
value INA
2. Patents of the acquired company at fair value
INA
3. The know how of the employees of the acquired company at
fair value GW
4. The projects in development of the acquired company at fair
value INA
5. The expected synergies that the acquiring company considered
when negotiating the price paid to the selling shareholders of the
GW
acquired company
6. The lean production process of the acquired company at fair
value GW
7. Financial debt of the acquired company at fair value
Department for Financial Reporting and Audit INA
2. Business Combinations
QUIZ (1/2)
1. The individual financial statements of French
companies are prepared under IFRS X
2. A group is an economic entity composed of different
legal entities √
3. Company A owns 10 % of entity E1 shares.
E1 is included in the scope of consolidation of company A X
4. Company A has a controlling influence on entity E2.
E2 is included in the scope of consolidation of company A √
5. Company A owns 0 % of entity E3 shares.
It is absolutely impossible to include E3 in the scope X
of consolidation of company A
Department for Financial Reporting and Audit
2. Business Combinations
QUIZ (2/2)
6. The only possibility to control another company is to
own more than 50% of the voting rights of this company X
7. Goodwill is always equal to the difference between the
purchase price (cost of investment) of shares and the X
book value of these shares
8. Consolidated net income = net income of the parent
company + 100% of the (post-acquisition and for
√
consolidation adjusted) net income of the subsidiary
(even when the parent owns < 100%)
9. Non-controlling interest provide equity to a subsidiary.
Therefore, they are included in consolidated equity √
10. The equity method consists in measuring the
investment in the associate company at fair value (eg, X
market value)
Department for Financial Reporting and Audit