Amalgamation - treatment of reserves
This query is : Open
29 March 2013
This doubt is in reference with Amalgamation and Treatment of Reserves, specifically while calculating purchase consideration pooling of interest method.
Issue:
When two companies amalgamate and we follow 'Pooling Interest Method', the difference between the amt recorded as share capital issued (by transferee)and share capital of transferor company is adjusted against the reserves available.
Doubt:
> What if the reserves are too less to adjust the difference amount?
> In which account head we should show 'Negative Reserve' (since we can't create 'Goodwill' under pooling of interest method)
Thanks.
-Shagun Borgaonkar
Issue:
When two companies amalgamate and we follow 'Pooling Interest Method', the difference between the amt recorded as share capital issued (by transferee)and share capital of transferor company is adjusted against the reserves available.
Doubt:
> What if the reserves are too less to adjust the difference amount?
> In which account head we should show 'Negative Reserve' (since we can't create 'Goodwill' under pooling of interest method)
Thanks.
-Shagun Borgaonkar
30 March 2013
i think u will reduce the profit and loss account
Message likes :
1 times
30 March 2013
Sorry Sir,
By reserves i mean including P&L Account.
By reserves i mean including P&L Account.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Section 54F - Exemption on LTCG in 2026 for HP purchased in 2023
- STCG....................................................
- Sales return eway bill
- Treatment of Pension ?annuity returns on PMVY
- TAN for Partnership
- AMOUNT RECEIVED UNDER COMPULOSRY ACQUISITION OF AGRICULTURAL LAND
- CA IPCC Registeration in 2012, Is my registration Active or Expired
- Small dealers gst returns filing
- Free lancer income
- LTCG for Assmt year 26-27
- Gst invoice numbering and delivery challan numbering
- Standard Deduction claim for EPFO Pension and ICICI Prudential Life Annuity
- Sales amount in Gstr1
- CG after sale of flat
- E Commerce GSTR1 & 3B how to file
- Nomination of Bank for refund in itr 2
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
