Deloitte FAS 141R-Acquisition Accounting

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Uncertain tax positions — generallyFinancial Reporting• A tax position is first evaluated for recognition based uponits technical merits. Tax positions that meet a recognitioncriterion are then measured to determine an amount torecognize in the financial statements. ASC 740-10-05-6• Acquirer can only change the recognition and measurementof target’s historic tax positions based upon new informationand not from a new evaluation or new interpretation bymanagement of information that was available in a previousfinancial reporting period. ASC 740-10-35 and 10-40Note: In order to make changes in recognition (e.g., new courtcase) or measurement (e.g., different settlement profile),identification of new information is requiredCopyright © 2012 <strong>Deloitte</strong> Development LLC. All rights reserved.24
Uncertain tax positions — acquired entitiesChanges in an acquired entity’s uncertain tax positions:• After the acquisition date, all adjustments to an acquired entity’suncertain tax positions are recorded in income tax expense, with oneexception:– If the company is still finalizing its accounting during the measurement period,and an adjustment is required that is based on new information about factsand circumstances that existed as of the acquisition date, then the adjustmentis recorded to goodwill• It is important to:– Finalize tax due diligence before measurement period ends– Refine UTB analysis before measurement period ends– Document all information available and considered at the acquisition dateCopyright © 2012 <strong>Deloitte</strong> Development LLC. All rights reserved.25
Page 4: Tax status of enterprise being acqu
Page 7 and 8: Taxable business combinations• Ac
Page 9 and 10: Financial Reporting for TaxesStep 2
Page 11 and 12: Example 1 — taxable asset purchas
Page 14 and 15: Application to specific basis diffe
Page 16 and 17: Goodwill (cont.)Tax Accounting for
Page 18 and 19: In-process R&DFinancial Reporting
Page 20 and 21: Deferred revenueFinancial Reporting
Page 22 and 23: Accrued compensationFinancial Repor
Page 28 and 29: Valuation allowances — section 38
Page 30 and 31: Example 4 — indemnification and U
Page 34 and 35: Transaction costs — pre-acquisiti
Page 36 and 37: Example 5 — transaction costs (co
Page 38 and 39: Example 6 — transaction costsFact
Page 42 and 43: Example 7 — measurement period ad
Page 44 and 45: Example 7 — measurement period ad
Page 46 and 47: Example 8 — contingent considerat
Page 54 and 55: Sample UTB tabular rollforward(Doll
Page 56 and 57: Supporting process and documentatio
Page 58 and 59: Copyright © 2012 Deloitte Developm
Page 60: About DeloitteDeloitte refers to on

Deloitte FAS 141R-Acquisition Accounting

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