Posts Tagged ‘corporate reorganisations’

Audits of Japanese Corporate Reorganizations.

August 28, 2011  |  Developments, News  |  No Comments

News, information

In recent months the Japanese specialist tax press has reported on the increasing number of Japanese tax audits focusing on Japanese tax preferred corporate reorganizations (below “Japanese TPCRs’) . Please see the corporate reorganization section for details Read More

Contributing assets for shares

September 9, 2010  |  Business combinations  |  No Comments
Steller's Sea Eagle taken in Shiretoko Hokkaido

Steller's Sea Eagle taken in Shiretoko Hokkaido

A common transaction in a group reorganization is the contribution by a company of assets other than monetary assets in exchange for shares in another company. Such a transaction would typically occur in an incorporation transaction or perhaps in the process of consolidating subsidiaries under a single parent company. Read More

Taxation of mergers

Tale from a zen koan

For many years I was looking for the ox. I was so stupid! In fact I found a Cow! - A attractive photo-montage illustrating a Zen Koan

This article is an outline of the taxation of Japanese corporate reorganizations, focusing on mergers and looking at the key criteria that will determine how Ceasing KK in the merger will be taxed.

Please also see this article for diagrams with an outline of Japanese merger transactions and this article with an overview of the accounting treatment of Japanese enterprise combinations.

This article Read More

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

Mergers and qualification for tax purposes – flowchart

Merger criteria flowchart

The flowchart in this article outlines the criteria that determine whether or not a Merger is qualified for Japanese tax purposes. Where a merger is qualified for Japanese tax purposes then, in principle, the Merger is not treated as a taxable event and gains or losses, including the recognition of goodwill, that would otherwise be crystallised in the Ceasing Company in the Merger are deferred. 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