IFRS Foundation
Example8 2012-01-01 2012-12-31 Example8 2012-06-30 example8:TCMember Example8 2012-01-01 2012-12-31 example8:TCMember iso4217:EUR xbrli:pure

IFRS Taxonomy 2017 – Illustrative examples

Business Combinations

Examples from IFRS 3 (IE72) representing some of the disclosures required by IFRS 3 for acquisition of a  company using block and detailed XBRL tagging.

IFRS3.IE72

Footnote X: Acquisitions

On 30 June 20X2 AC acquired 15 per cent of the outstanding ordinary shares of TC.  On 30 June 2012 AC acquired 60 per cent of the outstanding ordinary shares of TC and obtained control of TC.   TC is a provider of data networking products and services in Canada and Mexico.  As a result of the acquisition, AC is expected to be the leading provider of data networking products and services in those markets.  It also expects to reduce costs through economies of scale.

The goodwill of CU 2,500 arising from the acquisition consists largely of the synergies and economies of scale expected from combining the operations of AC and TC.

None of the goodwill recognised is expected to be deductible for income tax purposes.  The following table summarises the consideration paid for TC and the amounts of the assets acquired and liabilities assumed recognised at the acquisition date, as well as the fair value at the acquisition date of the non-controlling interest in TC.

At 30 June 20X2

Consideration

CU

Cash

5,000

Equity instruments ( 100,000 ordinary shares of AC)

4,000

Contingent consideration arrangement

1,000

Total consideration transferred

10,000

Fair value of AC’s equity interest in TC held before the business combination

2,000

12,000

                                                      

Acquisition-related costs (included in selling, general and administrative expenses in AC’s statement of comprehensive income for the year ended 31 December 20X2)

1,250

Recognised amounts of identifiable assets acquired and liabilities assumed

Financial assets

3,500

Inventory

1,000

Property, plant and equipment

10,000

Identifiable intangible assets

3,300

Financial liabilities

( 4,000)

Contingent liability

( 1,000)

Total identifiable net assets

12,800

Non-controlling interest in TC

( 3,300)

Goodwill

2,500

12,000


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