Accounting Standard Codification (ASC) 805 (formerly known as Financial Accounting Standard (FAS) 141R)
- ASC 805 (formerly known as FAS 141R) provides guidance for accounting and reporting of business combination. As per guidelines stated, an acquirer will recognize at the acquisition date all assets, liabilities and any non-controlling interest in the target company.
- ASC 805 emphasizes that for any activity to be considered as a business, it's mandatory to have inputs and processes elements which together will be used to generate outputs. An intangible asset should be recognized and recorded as an asset separate from goodwill in some scenarios. Most commonly recorded intangibles assets as per ASC 805 includes:
- Customer Relationships
- Noncompetition Agreement
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