Posts Tagged ‘accounting’

Joint venture formation and enterprise combination accounting

Criteria for a Japanese enterprise combination to be treated as a JV Formation

This article consists of a flowchart which applies the criteria used to determine whether or not an enterprise combination is treated as a JV Formation transaction under Japanese accounting standards.  The background to this treatment and the related standards is explained in this article. Read More

Japanese accounting for mergers and other enterprise combinations

A mendicant Buddhist outside Ueno station.

A mendicant Buddhist outside Ueno station.

This article discusses how mergers, takeovers and similar enterprise combinations are accounted for in Japan.
The articles looks at which accounting standards apply, the different categories of enterprise combinations defined in those standards and finally how purchase accounting Read More

M&A – allocating price to intangible assets

Entrance to a snow covered shrine in Hirotaka, Northern Japan

This post reviews principles behind allocating cost to intangible assets under Japanese purchase accounting for business combinations.

As part of Japan’s convergence with International Financial Reporting Standards (IFRS) Japanese  merger accounting (持分プーリング in Japanese, best translated as “pooling of interests”) is no longer available from 1 April 2010.  Also the Japanese Accounting Standards Board (‘JASB’) intends examining in Step 2 of its IFRS convergence process whether Japan’s current approach – amortisation of goodwill over a set period – should be brought closer to the IFRS approach (namely separately identifying intangible assets and goodwill and then periodically reviewing the value of such goodwill).  The JASBs request for public comment on accounting for business combinations is here and the related paper here. Read More

Japanese M&A accounting and IFRS convergence

A Buddha viewed past a screen covered with cursive Japanese script

This article includes a summary of the most recent changes to Japanese accounting standards relating to enterprise combinations which were proposed in 2008 as part of Japan’s IFRS convergence process and which came into force at for transactions from 1 April 2010 onwards (although earlier adoption was possible from 1 April 2009). Japanese accounting standards relating to business combinations including mergers and acquisitions, corporate splits and other corporate reorganisation transactions are also listed below. Read More