FASB's New Rules are Now In Effect
- Effective March 15, 2001, all companies with fiscal years after this date (but not calendar year companies) are entitled to elect early adoption of the FASB's new purchase rules.
- Effective June 30, 2001, pooling is officially eliminated. Mergers and acquisitions occurring after this date must use the purchase method. Acquired goodwill must still be amortized through the fiscal year.
- Effective December 15, 2001, companies with a fiscal year beginning after this date no longer must amortize existing goodwill.
The new FASB rules are slipping into the mainstream of accounting for mergers and acquisitions. CFO.com has prepared a special report on business combinations, explaining how these rules should be applied.
Included in the report are tips for tackling the impairment test, avoiding Securities & Exchange Commission inquiries, finding valuation experts, and more. The report is available at http://www.cfo.com/FASBguide.
Voice of the Editor
Which isn’t completely true. I mean, occasionally I drop by when I manage to sneak out of the nonstop frat party over at Going Concern, but I’m mostly a wallflower over there. I’m happy to say that I’ve been given express permission (or explicit orders, if you like) to wander over here to AccountingWEB more often.
Why is that, you might ask? My job is to replace the irreplaceable Gail Perry as Editor-in-Chief. What does that mean? I don’t really know! I think it’ll be fun getting a feel for things, throwing in my own thoughts here and there, and listening to the discussions you’re having about the accounting profession.