Valuation for Financial Reporting: Fair Value, Business Combinations, Intangible Assets, Goodwill, and Impairment Analysis, 3rd Edition

Preface ix

Acknowledgments xi

About the Authors xiii

About the Website xvii

Chapter 1 Fair Value Measurements and Financial Reporting: Financial Reporting and the Current Environment 1

Fair Value Measurements 6

Mark-to-Market Accounting 18

Notes 20

Appendix 1.1: Fair Value Flowchart 22

Chapter 2 Business Combinations 29

Intangible Assets 29

Business Combinations 35

The Acquisition Method 36

Recognition and Measurement 41

Goodwill 53

Recording the Consideration Transferred 55

Disclosure 56

Notes 57

Appendix 2.1: Business Combination Flowchart 60

Appendix 2.2: Business Combination Overview 65

Appendix 2.3: Intellectual Property 66

Chapter 3 Case Study 1: Determining the Value of Goodwill and Other Intangible Assets in a Business Combination 71

Consideration and Calculation of the Total of Intangible Assets and Goodwill 72

Business Enterprise Analysis 81

Valuation of Tangible Assets 88

Valuation of Intangible Assets 91

Valuation of Goodwill 122

Weighted Average Return on Assets 123

Disclosure 124

Notes 128

Chapter 4 Noncontrolling Interests and Impairment 131

Noncontrolling Interests 131

Impairment 135

Notes 141

Chapter 5 Case Study 2: Impairment Analysis 143

Valuation of Tangible Assets 155

Valuation of Intangible Assets 158

Conclusion 185

Notes 185

Chapter 6 Implementation and Reference Aids 187

Business Valuation Reporting Standards 187

Reference Aids 197

Implementation Aids 235

Notes 267

Index 269