Welcome to Financial Reporting – Module 5: Business Combinations & Group Accounting! In this episode, we move from single-entity reporting to the world of groups—how to identify a business combination and produce decision-useful consolidated financial statements.

We’ll unpack the acquisition method under IFRS 3: identifying the acquirer, measuring consideration (including contingent consideration), recognizing and measuring identifiable assets and liabilities at fair value, and determining goodwill (or a bargain purchase). We’ll also tackle the deferred tax effects of fair value step-ups and other temporary differences that arise on day one.

From there, we dig into control under IFRS 10—power, returns, and the link between them—and walk through tricky scenarios (potential voting rights, de facto control, structured entities). You’ll learn the mechanics of consolidation worksheets: pre- vs. post-acquisition reserves, non-controlling interests (measurement choices and subsequent movements), depreciation of fair-value uplifts, and eliminating intragroup balances, transactions, and unrealised profits.

Rounding out the module, we cover disclosures (IAS 1 and IFRS 12) for subsidiaries, associates, and joint arrangements, then switch gears to associates (IAS 28) using the equity method, and IFRS 11 distinctions between joint operations and joint ventures—what gets consolidated, what gets equity-accounted, and why it matters.

By the end, you’ll be able to analyze a transaction, decide whether it’s a business combination, apply the acquisition method, and prepare clear, compliant group financials—confidently navigating goodwill, NCI, deferred tax, and the equity method. Let’s dive in.

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