BUS 420 Lecture Notes - Lecture 8: Reverse Takeover, Financial Statement, Issued Shares

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 420
• Professor: Daniel Byrne

Document Summary

There are constant merger and acquisition news in the media. For example, by visiting the following web link you can take a look at the most recent mergers and acquisitions in north america: http://www. reuters. com/news/archive/americasmergersnews. This chapter discusses the concept of control and acquisition method used in accounting for three forms business combinations (purchase of assets, purchase of shares, and control by other contractual arrangements). The following major topics are covered in this chapter: accounting for different forms of business combination, purchase of net assets by issuing shares or cash payment, purchase of outstanding shares of investees: consolidated financial statements, reverse takeover (appendix) Chapter outline: accounting for different forms of business combination, introduction to business combination. A business combination occurs when one company, the acquirer, obtains control of one or more businesses (ifrs 3). Diversify into a new market and/or geographic region. Access to new customers, products or services, expertise or capabilities (eg. technology).