高级财务会计 陈信元 Introduction and chapter .ppt

methods of financial accounting are discussed. • Advanced accounting: Application of financial
accounting theories and methods in specific industries and transactions is described.
transaction and makes subsequent performance evaluation impossible • comparing firms using the alternative methods is difficult for investors. 6) IFRS 3 (2004): use the acquisition method
federal agencies.
2) State agencies review business combinations for
possible violations of state statutes.
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2. Brief Background on Accounting for B.C. 1) much of the controversy concerning accounting requirements for B.C. involved the Pooling of interests method, which became generally accepted in 1950 2) APB Opinion No. 16 (1970): 12 conditions 3) pooling of interests • valuation: BV • goodwill may not be created at the date of combination • the income of the combining companies for the entire
combining are expensed. • illustrations (p.23-24) 3) cost allocation procedures • determine the fair values of all identifiable tangible
and intangible assets acquired and liabilities assumed. include:
books are closed. • the acquiring firm records separate assets and liabilities
•A+B=A
2) consolidation
• a new firm is formed • the acquired firms normally cease to continue as SLEs. • the new firm records the separate assets and liabilities
carried forward to the acquiring entity.
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2) costs of B.C. • direct costs of registering and issuing securities are
charged against additional paid-in capital. • other direct costs and other indirect costs of
2006) and systems in PRC
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• Newspapers and Journals
- Journal of Accountancy
- Journal of Accounting Education
- 会计研究
- 财务与会计
4. Grading policy
Your grade in this course will be determined as
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• use fair values determined, in preferential order, by: - established market prices - present value of estimated future cash flows, discounted
year is included in the pooled entity 4) FASB Statement No. 141 (2001): • the pooling of interests method was eliminated for all
transactions initiated after June 30, 2001.
5) principal reasons for eliminating the pooling of interests method
• pooling provides less relevant information to users • pooling ignores economic value exchanged in the
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3. Application of the Acquisition Method
1) the acquisition method follows the cost principle for recording a business combination
• cost is measured by the cash disbursed, the fair value of property given up, or the fair value of securities issued. This is fair value rule.
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2. Topics of Advanced Accounting
• Business combination and CFS
• Partnership and branch accounting
• Issues in special reporting
• Accounting for foreign operations
Introduction to Advanced Accounting
1. Classification of Financial Accounting • Fundamental accounting: Basic procedures and
techniques of accounting are introduced. • Intermediate accounting: Basic theories and
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3) classification • horizontal integration • vertical integration
• conglomeration
12. Reasons
1) profitability
2) operating efficiencies
3) diversification of business risks
- identifiable intangibles resulting from legal or contractual
rights, or separable from the entity
- research and development in process
- contractual and some noncontractual contingencies
• goodwill may be recognized. • the income of the acquired company is included
only after the date of B.C. • the retained earnings of the acquired firm is not
• Governmental and nonprofit organization accounting
• other topics
3. References
• Floyd A. Beams: Advanced Accounting, 10th ed.
2009
• Legal requirements, accounting standards (CAS,
•A+B=C
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3) acquisition
• majority (50%) equity interest acquisition
• the position of SLE of each company is unchanged
• the acquiring company records an ‘Investment in S’
• the acquired company maintains its books as before
14. Types of considerations given up:
• cash
• non-cash . Antitrust Law
1) Proposed business combinations are reviewed by
business expansion thru. combination or construction ?
• cost advantage
• lower risk
• fewer operating delays • avoidance of takeovers