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substantially met as of the acquisition date. [FAS 164, paragraph 40, sequence 40.1.2]

  • >

    Recognizing Goodwill Acquired or a Contribution Received, Including

Consideration Transferred

958-805-25-27 An NFP acquirer applies the guidance in this Subsection instead of Subtopic 805-30 for the recognition of the following items:

a.

Goodwill acquired, whether recognized as an asset or as an immediate charge to the statement of activities

    • b.

      A contribution received in an acquisition

    • c.

      Consideration transferred, including contingent consideration.

  • >

    > Goodwill Acquired, Whether Recognized as an Asset or as an

Immediate Charge to the Statement of Activities

958-805-25-28 Unless the operations of the acquiree are expected to be predominantly supported by contributions and returns on investments (see paragraphs 958-805-25-29 through 25-30), an NFP acquirer shall recognize goodwill as of the acquisition date, measured in accordance with paragraph 958-805-30-6. [FAS 164, paragraph 50, sequence 50.1]

958-805-25-29 If the operations of the acquiree as part of the combined entity are expected to be predominantly supported by contributions and returns on investments, an NFP acquirer shall recognize a separate charge i n i t s s t a t e m e n t o f a c t i v i t i e s a s o f t h e a c q u i s i t i o n d a t e , m e a s u r e d i n than accordance with paragraph 958-805-30-6, rather goodwill.

Predominantly supported by means that contributions and returns on investments are expected to be significantly more than the total of all other sources of revenues. [FAS 164, paragraph 51, sequence 51]

958-805-25-30 An NFP acquirer shall consider all relevant qualitative and quantitative factors in determining the expected nature of the predominant source of support for an acquiree’s operations as part of the combined entity. For example, an NFP acquirer shall consider qualitative and quantitative information about all forms of contributed support, including contributions that are precluded from being recognized or are not required to be recognized in the financial statements (such as certain contributed services and collection items and conditional promises to give). [FAS 164, paragraph 52, sequence 52]

  • >

    > A Contribution Received in an Acquisition

958-805-25-31 An NFP acquirer shall recognize an inherent contribution received, measured in accordance with paragraph 958-805-30-8, as a separate credit in its statement of activities as of the acquisition date. [FAS 164, paragraph 54, sequence 54] Example 1 (see paragraphs 958-805-55-49 through 55-50) and Example 6 (see paragraphs 958-805-55-62 through 55-67) illustrate acquisitions with inherent contributions.

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