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Advanced Financial Reporting: Accounting for Business Combinations and Preparation of Consolidated Financial Statements

University of Illinois at Urbana-Champaign

About this Course

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This course covers the accounting for business combinations (ASC 805), the preparation of consolidated financial statements (ASC 810), and other related topics including, but not limited to: step-by-step acquisition, deconsolidation, segments reporting, and the goodwill impairment test. This course begins with a discussion of the scope of ASC 805 and the differences between business combinations and asset acquisitions. Next, the course explores the measurement and recognition principles of the acquisition method to account for business combinations. Then, the course covers the consolidation process. You will learn how to prepare the consolidated financial statements and make all of the necessary consolidation adjustments.

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Shareable Certificate

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Advanced Level

Approx. 25 hours to complete

English

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Flexible deadlines

Reset deadlines in accordance to your schedule.

Shareable Certificate

Earn a Certificate upon completion

100% online

Start instantly and learn at your own schedule.

Advanced Level

Approx. 25 hours to complete

English

Could your company benefit from training employees on in-demand skills?

Try Coursera for Business

Instructor

Instructor rating

4.6/5 (64 Ratings)

Michael Kustanovich, CPA

Clinical Assistant Professor of Accountancy

Accountancy

13,634 Learners

1 Course

Offered by

University of Illinois at Urbana-Champaign

Start working towards your degree

This Course is part of an online degree program offered by the University of Illinois at Urbana-Champaign. When you apply for a for-credit non-degree course through the university and complete it online, it counts as credit hours towards a degree at Illinois. All you have to do is apply through the university.

Master of Science in Accountancy (iMSA)

University of Illinois at Urbana-Champaign

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Syllabus - What you will learn from this course

Week

Week 1

1 hour to complete

Course Orientation

1 hour to complete

3 videos (Total 5 min), 4 readings, 1 quiz

3 hours to complete

Module 1: Control of a Business

3 hours to complete

5 videos (Total 30 min), 1 reading, 5 quizzes

5 videos

Overview of Accounting for Investment in Equity Securities – Part 17m

Overview of Accounting for Investment in Equity Securities – Part 27m

Control4m

Scope of ASC 805 – "Business Combinations"3m

Acquisition of a Group of Assets6m

1 reading

Module 1 Overview and Resources10m

5 practice exercises

Lesson 1-1 Knowledge Check30m

Lesson 1-2 Knowledge Check30m

Lesson 1-3 Knowledge Check30m

Lesson 1-4 Knowledge Check30m

Module 1 Quiz

Week

Week 2

2 hours to complete

Module 2: Acquisition Method

2 hours to complete

4 videos (Total 30 min), 1 reading, 4 quizzes

Week

Week 3

2 hours to complete

Module 3: Components of Consideration Transferred in a Business Combination

In this module, you will be introduced to different components of consideration transferred in a business combination. You will learn the measurement principles of share-based payment awards and will examine a real-life merger between Express Scrips and Medco companies. Moreover, you will be introduced to the concept of contingent consideration and learn the methods to classify, recognize, and record contingent considerations.

2 hours to complete

4 videos (Total 36 min), 1 reading, 3 quizzes

Week

Week 4

3 hours to complete

Module 4: Assets Acquired and Liabilities Assumed

In this module, you will gain a deeper understanding of the assets acquired and liabilities assumed in a business combination. You will be introduced to different types of identifiable assets acquired, such as defensive intangible assets and in-process research and development (IPR&D), and the rules to recognize and measure them under US GAAP and IFRS. You will also learn the difference between a taxable transaction and a non-taxable transaction, and how to calculate deferred taxes on an acquisition date.

3 hours to complete

5 videos (Total 35 min), 1 reading, 5 quizzes

5 videos

Identifiable Assets Acquired7m

Intangible Assets Other Than Goodwill5m

Defensive Asset and In-Process Research and Development (IPR&D)6m

Deferred Taxes on the Acquisition Date – Part 19m

Deferred Taxes on the Acquisition Date – Part 26m

1 reading

Module 4 Overview and Resources10m

5 practice exercises

Lesson 4-1 Knowledge Check30m

Lesson 4-2 Knowledge Check30m

Lesson 4-3 Knowledge Check30m

Lesson 4-4 Knowledge Check30m

Module 4 Quiz

Week

Week 5

3 hours to complete

Module 5: Preparation of Consolidated Financial Statements after the Acquisition Date

In this module, you will learn how to prepare the consolidated financial statements after the acquisition date. The concept of accounting acquisition premium (AAP), and the methods to calculate identifiable and unidentifiable portions of the accounting acquisition premium will be introduced. You will also learn the effects of accounting acquisition premium on the consolidated financial statements and the relevant consolidation adjustments. Moreover, you will be introduced to intercompany inventory transactions and learn to make consolidation adjustments for intercompany inventory sales and intercompany inventory profits.

3 hours to complete

5 videos (Total 44 min), 1 reading, 5 quizzes

5 videos

Accounting Acquisition Premium (AAP)6m

The Effect of AAP on Consolidated Financial Statements6m

Consolidated Financial Statements with AAP – Part 18m

Consolidated Financial Statements with AAP – Part 27m

Intercompany Inventory Transactions14m

1 reading

Module 5 Overview and Resources10m

5 practice exercises

Lesson 5-1 Knowledge Check30m

Lesson 5-2 Knowledge Check30m

Lesson 5-3 Knowledge Check30m

Lesson 5-4 Knowledge Check30m

Module 5 Quiz

Week

Week 6

4 hours to complete

Module 6: Intercompany Transactions and Noncontrolling Interest

In this module, you will be introduced to more types of intercompany transactions as well as noncontrolling interests. You will learn the consolidation adjustments for intercompany transactions with depreciable assets and intercompany debt. The noncontrolling interest (NCI) will be introduced. You will learn the definition, calculation, and presentation of noncontrolling interest and net income attributable to NCI in the consolidated financial statements. You will also learn how to report consolidated retained earnings and the subsequent measurement of noncontrolling interests. Lastly, an example of consolidation with noncontrolling interest will be shown.

4 hours to complete

6 videos (Total 46 min), 1 reading, 7 quizzes

6 videos

Intercompany Transactions with Depreciable Assets5m

Intercompany Debt5m

Noncontrolling Interest (NCI)8m

Net Income Attributable to NCI10m

Consolidated Retained Earnings and Subsequent Measurement of NCI4m

Example of Consolidation with NCI10m

1 reading

Module 6 Overview and Resources10m

7 practice exercises

Lesson 6-1 Knowledge Check30m

Lesson 6-2 Knowledge Check30m

Lesson 6-3 Knowledge Check30m

Lesson 6-4 Knowledge Check30m

Lesson 6-5 Knowledge Check30m

Lesson 6-6 Knowledge Check30m

Module 6 Quiz

Week

Week 7

3 hours to complete

Module 7: Change in the Percentage of Ownership and Other Related Topics

In this module, we will explore the accounting rules for changes in the percentage of ownership of a Subsidiary and other topics that relate to business combinations. You will learn how to account for a business combination that was achieved in stages, and how to calculate the gain or loss on deconsolidation of the Subsidiary. Also, you will be introduced to the situation in which the Subsidiary acquires shares of the Parent and learn the methods to measure and record the transaction.

3 hours to complete

5 videos (Total 34 min), 1 reading, 5 quizzes

5 videos

Business Combination Achieved in Stages – Part 110m

Business Combination Achieved in Stages – Part 25m

Deconsolidation8m

Change in the Percentage of Ownership without Loss of Control7m

Subsidiary Holds Shares of the Parent3m

1 reading

Module 7 Overview and Resources10m

5 practice exercises

Lesson 7-1 Knowledge Check30m

Lesson 7-2 Knowledge Check30m

Lesson 7-3 Knowledge Check30m

Lesson 7-4 Knowledge Check30m

Module 7 Quiz

Week

Week 8

5 hours to complete

Module 8: Segment Reporting and Goodwill Impairment Test

In this module, you will be introduced to segment reporting and the goodwill impairment test. You will learn the rules for public companies to disclose segment information in the notes to annual and interim financial statements. You will also learn what information should be presented in the entity-wide disclosures, and when. Then, the methods for identifying the reporting units, qualitative assessment for goodwill impairment, and the quantitative one-step goodwill impairment test will be introduced. You will also learn the goodwill impairment test under IFRS and the rules for private companies to account for goodwill.

5 hours to complete

8 videos (Total 42 min), 3 readings, 8 quizzes

8 videos

Segment Reporting13m

Entity-Wide Disclosure2m

Goodwill Impairment Test – Identification of the Reporting Units5m

Goodwill Impairment Test – Qualitative Assessment3m

One-Step Quantitative Goodwill Impairment Test3m

Goodwill Impairment Test Under IFRS7m

Private Companies Accounting for Goodwill2m

Gies Online Programs3m

3 readings

Module 8 Overview and Resources10m

Congratulations!10m

Get Your Course Certificate10m

8 practice exercises

Lesson 8-1 Knowledge Check30m

Lesson 8-2 Knowledge Check30m

Lesson 8-3 Knowledge Check30m

Lesson 8-4 Knowledge Check30m

Lesson 8-5 Knowledge Check30m

Lesson 8-6 Knowledge Check30m

Lesson 8-7 Knowledge Check30m

Module 8 Quiz

Reviews

4.7

55 reviews

5 stars
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4 stars
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3 stars
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2 stars
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1 star
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TOP REVIEWS FROM ADVANCED FINANCIAL REPORTING: ACCOUNTING FOR BUSINESS COMBINATIONS AND PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS

by AMSep 6, 2020

I have learning the how to make the financial statements

by ASJul 1, 2022

Brilliant topics and explanations. really insightful to me and will recommend it to my colleagues.

With regards,

Ali

by CSDec 31, 2021

The professor is a total success, well explained and subjects are easy to develop because of his way with students. Thank you!!

by AAAug 31, 2020

Good to equip yourself with, and very informative on business mergers.

View all reviews

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Advanced Financial Reporting: Accounting for Business Combinations and Preparation of Consolidated Financial Statements

Advanced Financial Reporting: Accounting for Business Combinations and Preparation of Consolidated Financial Statements

About this Course