...Accounting for Business Combinations: A Test for Long-Term Market Memory By Pongprot Chatraphorn Dissertation submitted to the faculty of the Virginia Polytechnic Institute and State University in partial fulfillment of the requirements for the degree of DOCTOR OF PHILOSOPHY In Business Administration with a Concentration in Accounting Dr. John A. Brozovsky, Chair Dr. Anthony J. Amoruso Dr. Robert M. Brown Dr. Frederick M. Richardson Dr. Keying Ye December 19, 2001 Blacksburg, Virginia Keywords: Business Combinations, Mergers, Acquisitions, Pooling, Purchase Accounting Copyright 2001, Pongprot Chatraphorn Accounting for Business Combinations: A Test for Long-Term Market Memory Pongprot Chatraphorn ABSTRACT The purpose of this research is to examine whether accounting methods for business combinations (purchase and pooling-of-interests accounting) have a different effect on firms’ market value of equity in the combination year and thereafter. In particular, after the accounting method is no longer disclosed in the financial statements, does it have an impact on market value of equity of the combined firms because the accounting figures are different? A five-year period subsequent to a particular business combination is used because public companies are not required to disclose the details of the combination for more than three years after the effective date of the combination. This research, thus, tests whether market participants still take into...
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...Permutations and Combinations Factorials A factorial is represented by the sign (!). When we encounter n! (known as 'n factorial') we say that a factorial is the product of all the whole numbers between 1 and n, where n must always be positive. For example 0! is a special case factorial. This is special because there are no positive numbers less than zero and we defined a factorial as a product of the numbers between n and 1. We say that 0! = 1 by claiming that the product of no numbers is 1. The reasoning and mathematics behind this is complicated and beyond the scope of this page, so let's just accept 0! as equal to 1. This works out to be mathematically true and allows us to redefine n! as follows: For example The above allows us to manipulate factorials and break them up, which is useful in combinations and permutations. Useful Factorial Properties The last two properties are important to remember. The factorial sign DOES NOT distribute across addition and subtraction. Permutations and Combinations Permutations and Combinations in mathematics both refer to different ways of arranging a given set of variables. Permutations are not strict when it comes to the order of things while Combinations are. For example; given the letters abc The Permutations are listed as follows Combinations on the other hand are considered different, all the above are considered the same since they have the exact same letters only arranged different. In other words, in combination, you can't just...
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...Chapter 1. Introduction to Mergers and Acquisition 1.1 Mergers and acquisition To opt for a merger or not is a complex affair, especially in terms of the technicalities involved. We have discussed almost all factors that the management may have to look into before going for merger. Considerable amount of brainstorming would be required by the managements to reach a conclusion. e.g. a due diligence report would clearly identify the status of the company in respect of the financial position along with the networth and pending legal matters and details about various contingent liabilities. Decision has to be taken after having discussed the pros & cons of the proposed merger & the impact of the same on the business, administrative costs benefits, addition to shareholders' value, tax implications including stamp duty and last but not the least also on the employees of the Transferor or Transferee Company. Merger: Merger is defined as combination of two or more companies into a single company where one survives and the others lose their corporate existence. The survivor acquires all the assets as well as liabilities of the merged company or companies. Generally, the surviving company is the buyer, which retains its identity, and the extinguished company is the seller. Merger is also defined as amalgamation. Merger is the fusion of two or more existing companies. All assets, liabilities and the stock of one company stand transferred to transferee company in consideration...
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...CHAPTER 2 CONSOLIDATION OF FINANCIAL INFORMATION Answers to Questions 1. A business combination is the process of forming a single economic entity by the uniting of two or more organizations under common ownership. The term also refers to the entity that results from this process. (1) A statutory merger is created whenever two or more companies come together to form a business combination and only one remains in existence as an identifiable entity. This arrangement is often instituted by the acquisition of substantially all of an enterprise’s assets. (2) a statutory merger can also be produced by the acquisition of a company’s capital stock. This transaction is labeled a statutory merger if the acquired company transfers its assets and liabilities to the buyer and then legally dissolves as a corporation. (3) A statutory consolidation results when two or more companies transfer all of their assets or capital stock to a newly formed corporation. The original companies are being “consolidated” into the new entity. (4) A business combination is also formed whenever one company gains control over another through the acquisition of outstanding voting stock. Both companies retain their separate legal identities although the common ownership indicates that only a single economic entity exists. Consolidated financial statements represent accounting information gathered from two or more separate companies. This data, although accumulated individually by the organizations, is brought together...
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...dancers but also classy young ladies. My first advanced dance class we were given a homework assignment. The assignment was to pick one of our combinations that we did in class and write it down without using the formal names of the movements. Initially I was confused because I wasn’t used to having homework for a dance class but also the assignment seemed so difficult. My body and brain have been trained to process these movements and think of it in a straightforward way and the assignment seemed to derail that train of thought. So I went home and sat with a piece of paper and pen in my hand. I picked my favorite barre exercise and began going through the motions of the combinations in my head. I had to keep in mind that I couldn’t use the actual term of the movement and had to communicate the combination by using smaller words like, “brush of the leg” or “toe taps.” I worked hard on the assignment for my first advanced dance class. I was proud of what I had come up with and was ready to show my teacher and my class. The next time the class met up we all shared our different renditions of how we translated our difference dance combinations. It was interesting seeing how the different girls came about the assignment. After hearing all of the dancers take on te combinations it seemed like we were suddenly all doing different combinations...
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...Mergers & Acquisitions in India With specific reference to Competition Law This research paper is a copyright of Nishith Desai Associates. No reader should act on the basis of any statement contained herein without seeking professional advice. The authors and the firm expressly disclaim all and any liability to any person who has read this research paper, or otherwise, in respect of anything, consequences by any such and of of anything in February 1, 2010 done, or omitted to be done person reliance upon the contents of this research paper. Nishith Desai Associates www.nishithdesai.com TABLE OF CONTENTS I. II. Introduction .................................................................................................................................................... 3 Mergers and Amalgamations: Key Corporate and Securities Laws Considerations. ...................................... 7 III. Acquisitions: Key Corporate and Securities Laws Considerations................................................................. 10 IV. Competition Law ............................................................................................................................................ 21 V. Exchange Control............................................................................................................................................ 24 VI. Taxes and Duties ...................................................................................................
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...machinery. Land could be rezone into a residential subdivision with a fair value of 30 million after considering cost for preparation. Equipment could be sold at auction for 2 million. The facility is estimated to be worth 36 million as acquired. Individual fair value of land is 21 million and for the buildings and machinery 7 million. In process Research an Development submited to FDA for aproval has a fair value of 15 millions Baked Beans trademark has a 3 million value. Management will not use nor sell the trademark. Trademark has a carrying value of 2 million ind Baked Beans financial statements. Financial Reporting Issue: Business combinations Discussion of financial reporting issue: First of all we need to determine if the transaction is a business combination process. The ACS 805 defines a business combination as a transaction or other event in which an acquirer obtains control of one or more businesses. Transactions sometimes referred to as true mergers or mergers...
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... Introduction Industry mergers or business combinations are a phenomenon that has been commonplace for quite some time now. They basically involve two or more organizations coming together to form a large corporate under which they operate. The new organization which may have a combination of the names of the merging components or a totally new name operates as a new entity. The new rule under which the new entity operates depends in the agreement on the terms of the merger. As stated in our advanced accounting text, the history of mergers can be traced back to the 1895 to 1905 period in the US when the small companies with small market shares combined forces to form larger entities that dominated the target markets. In this way their collective value accounted for 20% of the total GDP (Cartwright & Schoenberg, 2006, p 3). Since then mergers have remained a popular way of market consolidation and strengthening of the capital base of the various firms involved. The rise of globalization in the 1990s further increased the market for international mergers with firms located in different countries and continents coming together. These mergers have resulted in huge conglomerates across borders with multibillion dollar financial bases and thousands of international shareholders. This paper sets to discuss Exxon Mobil merger with special emphasis on the reason why they merged, type of combination they adopted, terms of the acquisition, and updates after the acquisition. ...
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...the compulsory & major. *Note 2:Students are strongly advised to follow the proper progression of course level (ie, take level 1 courses before level 2, and level 2 before level 3). *Note 3: Timetable- Detail of the class day, week and term would be reflected on the table below. If it is blank, a separate timetable will be issue to you at a later stage. COMPULSORY - 80 Credit Units Code ACC201e Name Financial Accounting Credit Jul Units 12 5 Y Jan 13 Y Jul 13 Y Jan 14 Y Last Presentation Time Table 2018/07 FRIDAY WEEK 1 TERM 1 FRIDAY WEEK 1 TERM 2 THURSDAY WEEK 2 TERM 1 MONDAY WEEK 2 TERM 1 MONDAY WEEK 2 TERM 2 TUESDAY WEEK 1 TERM 1 Pre-requisite Excluded Combination BFSZ231 or BFSZ333 or CUL207 BFSZ231 or BFSZ333 BSZ220 BSZ150 BSZ150 BUS101e & BUS103, HRM201 Grouping Remarks . Lab* NONLAB NONLAB NONLAB NONLAB NONLAB NONLAB ACC203e BUS105e BUS201 BUS203 BUS206 Managerial Accounting Statistics Contract and Agency Law Company Law and Corporate Governance Managing People 5 5 5 5 5 Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y 2018/07 2016/01 2016/01 2016/01 2020/01 Page 1 of 9 Code BUS488 Name Strategy Credit Jul Units 12 10 Y Jan 13 Y Jul 13 Y Jan 14 Y Last Presentation Time Table 2016/07 SATURDAY - Pre-requisite Excluded Combination BUS499 Grouping Remarks Lab* To take in final NONsemester of LAB programme of study. Compulsory Attendance is required for all seminar sessions. Penalty will be applied for absence from seminar without School of Business approval. NONLAB...
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...ll Why Does a Stock's Price Rise or Fall? Introduction Watching the ups and downs of stock prices can be enough to make you seasick. If you own stocks, you've undoubtedly followed their prices with a feeling of either satisfaction or disappointment, depending on how your investments have done. Short-term swings can be bewildering, and sometimes it seems as though stock prices follow a logic all their own. Even so, it is possible to break down stock performance in ways that help distinguish solid growth from inflated expectations. Case Study in Rising Prices: Wal-Mart A stock's price is determined by its fundamentals (how the company has actually performed) combined with its valuation (how much the market is willing to pay for that performance and the promise of future growth). Similarly, when a stock's price goes up, that rise comes from either (1) growth in the underlying business or (2) an increase in the stock's valuation, as the market becomes more optimistic about the company's future. As an illustration of these two drivers of stock performance, consider the history of Wal-Mart WMT. In the 1970s and 1980s, Wal-Mart was the quintessential growth stock. It was profitable, with returns on equity consistently above 20%. Year after year, its revenue and earnings grew by more than 25%, often by more than 30%, as it opened new stores all over the country. As a result of this consistent growth, the annualized return of Wal-Mart's stock from 1970 to 1990 was...
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...| | |Second Semester MBA | |Term Paper | |HUMAN RESOURCE DEVELOPMENT | | | |[pic] | | | | | |"PERFORMANCE APPRAISAL TECHNIQUES | |FOLLOWED IN ROBERT BOSCH" | | ...
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...Introduction Mrs. Fields Cookies was started by Debbi and Randy Fields in the August of 1977 from a borrowed amount of $50,000. Today the single store venture has grown onto become a huge a company with a hundreds of stores, well established corporate structure and thousands of employees. The company’s operations span across 25 states in the US, five countries and four continents. The company’s growth was explosive and within a short span of 5 years the company was expanding its operations in international markets. The reason for the meteoric rise of the company is the way Debbi and Randy have been able to monitor and control the various activities of the company by incorporating information technology into the day to day to operations. Also the management philosophy of Fields’ was in unison with the ideals of the founders. Debbi and Randy Fields were in control of every store and did not believe in franchising their stores. Their main motto was customer satisfaction and the profits came later. Felids’ enjoyed great success in the first decade of business but their first big failure happened when they acquired the 119 store French bakery/sandwich chain. La Petite Boulangerie (LPB) from PepsiCo in the April 1987. The acquisition was the part of the company’s diversification and expansion plan. Until the acquisition, the main product of the Fields’ were cookies alone which came in 14 different varieties. But the acquisition of LPB added a whole new range of products...
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...MERGERS AND ACQUISITIONS TABLE OF CONTENTS |TITLE |PAGE NUMBER | |ABSTRACT |3 | |INTRODUCTION |4 | |THE ACCOUNTING METHODS |7 | | VALUATION |8 | | TYPES OF MERGERS |9 | |WHY MERGERS |12 | |STATUTORY REGULATIONS |13 | |COMPARISON OF MERGERS IN INDIA AND CHINA |16 | |ARCELLOR MITTAL DEAL |17 | |DAIMLER CHRYSLER DEAL |19 ...
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...prevalent in the pharmaceutical industry and healthcare sector. Indicate the approach proposed to be taken for executing the study and analyzing the data collected in pursuance thereof. Broad Scheme of Presentation Indian Pharmaceutical Industry a Snapshot Access to Medicines Situation in India Objectives of the Study Anti-competitive Practices Competition Act 2002 Regulation of Combinations Anti-competitive Agreements Abuse of Dominance Proposed Chapterisation Proposed Methodology 1. 2. 3. Indian Pharmaceutical Industry a Snapshot Net Worth 8 Billion Dollars Growth Rate of 8-9% PA. 4th in the World in terms of Volume of Drug Output Exports to nearly 212 countries @ USD 4795.33 million (2005-06) Has an important role to play in promoting public health and Right to Health. Highly technology and knowledge intensive. Indian Pharmaceutical Industry a Snapshot Industry growth highly dependent on the regulatory environment . Owes its current growth and success to the Patents Act of 1970 which abolished product patents in the pharmaceutical sector. The same helped Reduce the manufacturing costs in terms of license fee Reduce the costs involved in R&D Diffusion of technology and knowledge through reverse engineering 1. 2. 3. Indian Pharmaceutical Industry a Snapshot There is no...
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...expressive means exist on all the levels of the language. The most powerful are phonetic expressive means including stress, whispering, high/fall alliteration. Morphological expressive means include the use of second and third persons. Word-building expressive means - the use of deminuative suffixes, such as -y (frequently used). On the lexical level we distinguish neutral vocabulary and exressive vocabulary. [to die - to go West, to work - to labour, fear - horror]. Proverbs also belong to the expressive vocabulary. On the syntactical level we distinguish between the inversion and repetition. A stylistic device is a conscious and intentional intencification of some typical structural or semantic property of a language unit (word, word combination or sentence) promoted to a generalised stater and thus become a generative model. stylistic devices are built according to a fixed model [a nice table, a tasty table, an angry table; a tasty table - a case of metonomy, an angry table - a transfered epithet]. Expressive means are trite and frequently employed. Stylistic devices are geniune to a certain extent. Stylistic devices belong to the language in use. Expressive means belong to the language as a system. Expressive means are fixed in the dictionaries. According to their structure expressive means and stylistic devices can be the same [a cold day - expressive means, a sparkling day - a stylistic device]. Exits own features and qualitiespressive means have...
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