Detail Everyone Out of The Pool   Oleh:  Moehrle, Stephen R. ; Wallace, James S. ; Reynolds-Moehrle, Jennifer A. Jenis: Article from Bulletin/Magazine Dalam koleksi: Journal of Accountancy vol. 189 no. 5 (2000), page 45-50. Topik: ACCOUNTING; out of the pool Ketersediaan Perpustakaan Pusat (Semanggi) Nomor Panggil: JJ85.10 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada     Lihat Detail Induk Isi artikel The United States is perhaps one of the last countries in the world to still permit pooling - of - interests accounting. FASB is now debating whether to eliminate pooling as a method of accounting for mergers and acquisitions. Following a September 1999 exposure draft, Business Combinations and Intangible Assets, FASB held public hearings in February and March. If a final proposal passes by the end of 2000, it could take effect on January 1, 2001. All U. S. companies initiating business combinations after that date would have to use the purchase method to account for the transaction. Experts expect a flurry of poolings in advance of the elimination of this popular accounting alternative as companies hurry to complete acquisitions while they still can do so without recording a large goodwill balance. Should companies race to beat the deadline ? We believe the answer to this question is no. America Online (AOL) and Time Warner will account for their recently announced merger as a purchase. That these companies will not structure the deal as a pooling is surprising to many observers, since the transaction will require the new company to recognize goodwill totaling about $150 billion. Deals of this size frequently are accounted for as poolings and often are contingent on the acquirer receiving pooling accounting treatment. AOL and Time Warner executives say purchase accounting will enable the new company, AOL Time Warner, to dispose of unproductive assets and conduct stock buybacks. This is not permitted if the company applies pooling accounting. Further, they believe most analysts will ignore the annual goodwill amortization “drag” and instead focus on the new company’s cash earnings disclosure. Following the merger, the new company will have to reduce net income by $7.5 billion each year for the next 20 years. AOL and Time Warner are confident analysts will disregard this charge against income and look at the new company’s reported cash earnings, which will not have to be reduced by the $7.5 billion expense. Our research supports AOL Time Warner’s decision and suggests companies should not race the clock to complete pooling - of - interests transactions. This is especially true for companies that are currently buying back shares or planning to do so in the near future. Opini Anda Klik untuk menuliskan opini Anda tentang koleksi ini! Kembali

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