how would the acquisition be accounted for under ifrs 3 562621

Facts

X plc

$m

Cost of acquisition

700

less fair value of net assets

300

less restructuring provision

(70)

Goodwill

470

Income statement at year end

Profit before amortization

140

Amortization of goodwill

(47)

93

Interest

(13)

Profit before tax

80

This information relates to the acquisition of X, a public limited company, by Z, a public limited company.

At the date of acquisition, the fair value of the intangible assets and the contingent liabilities of X were $100 million and $30 million respectively. At the date of the preparation of the financial statements, the value of the net assets of X had increased significantly. The intangible assets have a life of 10 years.

Required

How would the acquisition be accounted for under IFRS 3?

Submit a Comment