FAS 141R - Disclosures

By Linda Cavanaugh, CPA - FAS 141R – Disclosures

Disclosures for business combinations are to be for the current reporting period or after the reporting date but before the financial statements are issued. I.e. any subsequent events are to be disclosed.

The following information is to be disclosed for each business combination:

1.The name and a description of the acquiree

2.The acquisition date

3.The percentage of voting equity interests acquired

4.The primary reasons for the business combination and a description of how the acquirer obtained control of the acquiree

5.A qualitative description of the factors that make up the goodwill recognized

6.The acquisition-date fair value of the total consideration transferred and the acquisition-date fair value of each major class of consideration, such as:
a.Cash
b.Other tangible or intangible assets, including a business or subsidiary of the acquirer
c.Liabilities incurred, for example, a liability for contingent consideration
d.Equity interests of the acquirer, including the number of instruments or interests issued or issuable and the method of determining the fair value of those instruments or interest.

7.For contingent consideration arrangements and indemnification assets
a.The amount recognized as of the acquisition date
b.A description of the arrangement and the basis for determining the amount of the payment
c.An estimate of the range of outcomes (undiscounted) or, if a range cannot be estimated, that fact and the reasons why a range cannot be estimated. If the maximum amount of the payment is unlimited, the acquiree shall disclose that fact.

8.For acquired receivables not subject to the requirements of SOP 03-3:
a.The fair value of the receivables
b.The gross contractual amounts receivable
c.The best estimate at the acquisition date of the contractual cash flows not expected to be collected.

That's it. That is all I have to say about FAS141R. I am going to be so excited to move on to another topic!

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Linda is a CPA living in Southwestern Ohio, working as a research accountant for an investor-owned publicly traded utility company. She specializes in implementing new FASB and SEC requirements and FAS 133 derivative issues. In her role at the utility she has encountered many issues and written many memos, so send in your implementation and derivative issues and Linda will help figure out an answer.

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