Editorial Type:
Article Category: Research Article
| Online Publication Date: 01 Mar 2007
The Market Approach and the Impact of Business Combination Accounting Rules
The Market Approach and the Impact of Business Combination Accounting Rules
PhD, ASA
Page Range: 14 – 21
The implementation of SFAS 141 and IFRS is not only a step towards fair value accounting, but also has an impact on financial statements. The amortization charge of intangible assets has a direct profit and loss statement impact to be considered when performing the market approach. The subsequent analysis aims to illustrate the distortion that the new accounting rules can cause on the way multiples are computed and what adjustments are necessary if they are to be applied consistently between companies with different capital structures.Abstract
Copyright: © 2007 American Society of Appraisers
Contributor Notes
Péter Harbula, Ph.D., ASA, is a Director of Deloitte Financial Advisory Services in Paris, France. The views expressed in this article reflect only those of the author.