Dissent of Mary E Barth, Robert P Garnett and John T Smith

DO1 Professor Barth and Messrs Garnett and Smith dissent from the publication of IFRS 3 Business Combinations (as revised in 2008), for the reasons set out below.

Measurement of non‑controlling interest

DO2 Professor Barth and Mr Smith disagree with the Board’s decision to make an exception to the IFRS’s measurement principle and permit acquirers a free choice, acquisition by acquisition, to measure any non‑controlling interest in an acquiree as the non‑controlling interest’s proportionate share of the acquiree’s identifiable net assets, rather than at fair value (paragraph 19 of the IFRS).

DO3 Professor Barth and Mr Smith agree with the measurement principle as explained in paragraph BC207 that the acquirer should recognise the identifiable assets acquired, the liabilities assumed and any non‑controlling interest in the acquiree at their acquisition‑date fair values. Paragraph BC209 indicates that the Board also supports this principle, but decided to make an exception. Professor Barth and Mr Smith support the Board’s general view that exceptions should be avoided because they undermine principle‑based standards, but understand that they are necessary in well‑justified circumstances. Professor Barth and Mr Smith do not believe that an exception to this principle, with a free choice in applying it, is justified in this situation.