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Hi kikababoo
Believe you are referring to IFRS 3 Business Combination
http://www.ifrs.org/IFRSs/IFRS-technical...RS%203.pdf
Core principle
An acquirer of a business recognises the assets acquired and liabilities assumed at their acquisition-date fair
values and discloses information that enables users to evaluate the nature and financial effects of the
acquisition.
(PS: Acquisition date in this case refer to the date of attaining 20% interest)
http://www.iasplus.com/en/standards/ifrs/ifrs3
Business combination achieved in stages (step acquisitions)
Prior to control being obtained, an acquirer accounts for its investment in the equity interests of an acquiree in accordance with the nature of the investment by applying the relevant standard, e.g. IAS 28 Investments in Associates and Joint Ventures (2011), IFRS 11 Joint Arrangements, IAS 39 Financial Instruments: Recognition and Measurement or IFRS 9 Financial Instruments. As part of accounting for the business combination, the acquirer remeasures any previously held interest at fair value and takes this amount into account in the determination of goodwill as noted above [IFRS 3.32] Any resultant gain or loss is recognised in profit or loss or other comprehensive income as appropriate. [IFRS 3.42]
The accounting treatment of an entity's pre-combination interest in an acquiree is consistent with the view that the obtaining of control is a significant economic event that triggers a remeasurement. Consistent with this view, all of the assets and liabilities of the acquiree are fully remeasured in accordance with the requirements of IFRS 3 (generally at fair value). Accordingly, the determination of goodwill occurs only at the acquisition date. This is different to the accounting for step acquisitions under IFRS 3(2004).
For piecemeal (step) acquisition of investment in associate, it has to be read together with IFRS 3.
Believe you are referring to IFRS 3 Business Combination
http://www.ifrs.org/IFRSs/IFRS-technical...RS%203.pdf
Core principle
An acquirer of a business recognises the assets acquired and liabilities assumed at their acquisition-date fair
values and discloses information that enables users to evaluate the nature and financial effects of the
acquisition.
(PS: Acquisition date in this case refer to the date of attaining 20% interest)
http://www.iasplus.com/en/standards/ifrs/ifrs3
Business combination achieved in stages (step acquisitions)
Prior to control being obtained, an acquirer accounts for its investment in the equity interests of an acquiree in accordance with the nature of the investment by applying the relevant standard, e.g. IAS 28 Investments in Associates and Joint Ventures (2011), IFRS 11 Joint Arrangements, IAS 39 Financial Instruments: Recognition and Measurement or IFRS 9 Financial Instruments. As part of accounting for the business combination, the acquirer remeasures any previously held interest at fair value and takes this amount into account in the determination of goodwill as noted above [IFRS 3.32] Any resultant gain or loss is recognised in profit or loss or other comprehensive income as appropriate. [IFRS 3.42]
The accounting treatment of an entity's pre-combination interest in an acquiree is consistent with the view that the obtaining of control is a significant economic event that triggers a remeasurement. Consistent with this view, all of the assets and liabilities of the acquiree are fully remeasured in accordance with the requirements of IFRS 3 (generally at fair value). Accordingly, the determination of goodwill occurs only at the acquisition date. This is different to the accounting for step acquisitions under IFRS 3(2004).
For piecemeal (step) acquisition of investment in associate, it has to be read together with IFRS 3.
