RSM321H1 Chapter Notes - Chapter 3: Financial Statement, Reverse Takeover, Historical Cost
Document Summary
A business combination is defined in ifrs 3 business combinations as a transaction or other event in which an acquirer obtains control of one or more businesses. This definition has two key aspects: control and businesses. When a business combination does occur, the requirements of. On the other hand, if an entity acquires all of the assets of another entity but they do not meet the definition of a business, ifrs 3 would not be applicable. Instead, the assets acquired would be treated as a basket purchase, and the total cost would be allocated to the individual assets in proportion to their fair market values. There are many types of business combinations including a conglomerate business combination, a horizontal business combination, and a vertical business combination. Other terms that are often used synonymously with the term business combination are takeover, amalgamation, acquisition, and merger.
