Consolidation with a Non-controlling Interest

Other

Consolidation with a Non-controlling Interest

http://sec.gov/edgar/searchedgar/companysearch.html). Review these documents in addition to Earnings Releases and other financial information available on the company’s Investor Relations Web site to evaluate the following items.

Business Combination

  • Identify entities involved in the merger or acquisition.
  • Identify key factors involved in the determination of the transaction price and payment terms.
  • Explain the method used to account for the business combination for financial statement purposes.
  • Evaluate the valuation of assets, including goodwill, and liabilities acquired in the business combination.
  • Discuss the calculation of the investment in the subsidiary on the parent company’s books at the date of acquisition.

Intercompany Transactions

  • Discuss methods used to account for investments in a consolidated financial statement. Explain journal entries on the parent’s books to account for an investment using the cost method, the partial equity method, and the complete equity method.
  • Explain the financial reporting objectives for intercompany sales of inventory and determine the amount of intercompany profit, if any, eliminated from the consolidated statements.

Prepare a 10-12 page research paper (excluding title page, abstract, references page, and appendices containing financial analysis) in APA format that presents the findings of your analysis of the company’s SEC filings. Your paper should also discuss the following:

  • Accounting theory governing business combinations in US GAAP and IFRS.
  • Strategic objectives achieved as a result of the business combination.
  • Purpose of due diligence in mergers and acquisitions.
  • Role of the public accountant in supporting business combinations.
  • Use of computer assisted auditing techniques.
  • GAAS, GAAP, PCAOB, and COSO requirements for audits of consolidated financial statements of publicly traded companies.

In addition to the SEC Forms, a minimum of five (5) peer-reviewed academic or professional references must be used in the paper.

This assignment will be assessed using additional criteria provided here.

Please submit your assignment.

Grading Criteria

Students should complete the following items for this assignment:

Identify entities involved in the merger or acquisition.

5%

Identify key factors involved in the determination of the transaction price and payment terms.

5%

Explain the method used to account for the business combination for financial statement purposes.

5%

Evaluate the valuation of assets, including goodwill and liabilities acquired in the business combination.

5% 

Discuss the calculation of the investment in the subsidiary on the parent company’s books. 5%
Discuss methods used to account for investments in a consolidated financial statement. 5%
Explain the financial reporting objectives for intercompany sales of inventory. 5%
Accounting theory governing business combinations in US GAAP and IFRS. 5%
Strategic objectives achieved as a result of the business combination. 10%
Purpose of due diligence in mergers and acquisitions. 10%
Role of the public accountant in supporting business combinations. 10%
Use of computer assisted auditing techniques. 10%
GAAS, GAAP, PCAOB, and COSO requirements for audits of consolidated financial statements. 10%
APA format. 10%

For assistance with your assignment, please use your text, Web resources, and all course materials.

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