IFRS 3 - Business Combinations: HISTORY OF IFRS 3 (Last Page)
IFRS 3 - Business Combinations: HISTORY OF IFRS 3 (Last Page)
activities*
Overview
IFRS 3 Business Combinations outlines the Acquisition date - The date on which the acquirer obtains
accounting when an acquirer obtains control of a control of the acquiree
business (e.g. an acquisition or merger). Such business
combinations are accounted for using the 'acquisition Acquirer - The entity that obtains control of the acquiree
method', which generally requires assets acquired and
liabilities assumed to be measured at their fair values at
Acquiree - The business or businesses that the acquirer
the acquisition date.
obtains control of in a business combination
A revised version of IFRS 3 was issued in *definition narrowed by 2018 amendments to IFRS 3 issued
January 2008 and applies to business combinations on 22 October 2018 effective 1 January 2020
occurring in an entity's first annual period beginning on
or after 1 July 2009.
Scope
IFRS 3 must be applied when accounting for business
combinations, but does not apply to:
HISTORY OF IFRS 3 (last page)
The formation of a joint venture [IFRS 3.2(a)]
The acquisition of an asset or group of assets
Amendments under consideration by the IASB that is not a business, although general guidance
o Common control transactions is provided on how such transactions should be
o Goodwill and impairment accounted for [IFRS 3.2(b)]
Combinations of entities or businesses under
Summary of IFRS 3 common control (the IASB has a separate
agenda project on common control transactions)
Background
[IFRS 3.2(c)]
IFRS 3 (2008) seeks to enhance the relevance, reliability
Acquisitions by an investment entity of a
and comparability of information provided about
subsidiary that is required to be measured at fair
business combinations (e.g. acquisitions and mergers)
value through profit or loss under IFRS 10
and their effects. It sets out the principles on the
Consolidated Financial Statements. [IFRS 3.2A]
recognition and measurement of acquired assets and
liabilities, the determination of goodwill and the
necessary disclosures.