Combinations of mutual entities (paras. BC64-BC77)

BC64 During its deliberations leading to SFAS 141, the FASB concluded that combinations involving only mutual entities should also be accounted for using the acquisition method but decided not to mandate its use until the FASB had considered implementation questions raised about the application of that method. Similarly, IFRS 3 did not require use of the acquisition method for combinations of mutual entities, although the IASB had also concluded that the acquisition method was appropriate for those combinations. Instead, as part of the first phase of its business combinations project, the IASB published an exposure draft of proposed amendments to IFRS 3 - Combinations by Contract Alone or Involving Mutual Entities, which proposed an interim approach for accounting for those combinations until the IASB had considered related implementation issues in the second phase of its project. In the light of respondents’ comments, the IASB decided not to proceed with the proposals in the exposur

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