This course provides an overview of accounting and reporting challenges encountered in M&A transactions. The primary focus is on the top challenges faced by accountants in the preparation and execution of M&A accounting, from valuation and due diligence to post-acquisition integration. This course provides an overview of how to address complex issues such as identifying the acquirer, measuring fair value, allocating purchase price, and accounting for goodwill and contingent consideration.

Chapter 1: Pre-Acquisition – Planning and Due Diligence - Overview

This chapter covers key pre-acquisition accounting challenges, including identifying the accounting acquirer, particularly in mergers of equals and reverse acquisitions. It addresses the treatment of pre-acquisition contingencies, such as litigation and tax exposures, and the proper handling of acquisition-related costs like legal fees and due diligence expenses. Additionally, the chapter addresses how purchase agreement terms impact accounting and provides insight into the valuation and accounting for contingent consideration.

Chapter 2: Acquisition Date Initial Recognition and Measurement - Overview

This chapter provides a comprehensive overview of the accounting and reporting requirements for recognizing assets and liabilities in business combinations. It focuses on the key principles and methodologies for identifying and measuring the assets acquired, liabilities assumed, and any noncontrolling interest in the acquiree.

Chapter 3: Post-Acquisition Accounting and Reporting - Overview

This chapter covers key post-acquisition accounting issues, including the recognition and measurement of goodwill as well as bargain purchases. It also addresses income tax implications and accounting for step acquisitions, including revaluing equity interests and recognizing gains or losses. This chapter concludes with a discussion of subsequent measurement requirements for assets and liabilities recognized.

Chapter 4: Post-Acquisition Testing and Disclosures - Overview

This chapter addresses key post-acquisition activities including the subsequent accounting for goodwill and the ASC 805 disclosure requirements with respect to business combinations. The chapter also highlights common post-acquisition pitfalls, such as inconsistencies in fair value allocations and challenges in goodwill adjustments.