7
ACCOUNTING ASPECTS OF CORPORATE RESTRUCTURING CHAPTER
Q1. The accounting treatment of Mergers and Acquisitions has undergone drastic change with the introduction of IND-AS 103 - Business Combination. Comment [Dec. 2019 - New Syllabus - 5 Marks] OR
Auditor of Jumbo Ltd. has informed following to the Board of directors:
(
(
i) Tax neutrality of a demerger may get affected on adoption of INDAS 103.
ii) Appointed Date has lost relevance if a company accounts the transaction accordance with IND-AS 103.
Examine the correctness of the observations made by the auditor. [Dec. 2022, 3 Marks]
Ans. -
(a) Method of Accounting for business combination
(
b) Appointed date v. Effective date
(c) Accounting for goodwill
Q2. How goodwill and capital reserve are differentiated as per AS-14? [Dec. 2019 - New Syllabus - 3 Marks] Ans.
Q3. Accounting Standard-14 is applicable to demerger. [June 2019 - Old Syllabus - 3 Marks]
Ans.
Sony India Private Limited (Sony India) and Sony Software Centre Private Limited (Sony Software)
Gal-
lops Realty Pvt. Ltd
Q4. “Accounting treatment under AS 14 is confined to Amalgamations unlike Ind AS 103.” Discuss how far Ind AS 103 can be distinguished with AS 14. [Dec. 2017, Dec 2018 - Old Syllabus - 5 Marks]
Ans.
Q5. Is it possible to retain the same characters of various reserves of transferor Companies post amalgamation, mergers or demergers as per Standards of Accounting concepts or conventions? [Dec. 2018 - Old Syllabus - 5 Marks]
Ans.
Q6. Describe the ‘pooling of interests method’ of accounting adopted by amalgamated company. [Dec. 2016 - Old Syllabus - 5 Marks]
Ans.
Q7. What is meant by ‘goodwill on amalgamation’? Which factors are to be taken into account in estimating useful life of goodwill?
[Dec. 2016 - Old Syllabus - 5 Marks] Ans.
Q8. “Certain disclosures are required to be made in the first financial statements prepared after the amalgamation orders.” Mention such disclosures. [June 2016 - Old Syllabus - 5 Marks]
Ans. -
pooling of interest method -
purchase method,
Q9. Briefly explain the provisions regarding accounting treatment in the books of the Transferee Company on amalgamation where Indian Accounting Standard - 103 (Business Combinations of Entities under Common Control) is applicable. [Dec. 2021 - New Syllabus - 5 Marks]
Ans.
OTHER IMPORTANT QUESTIONS
Q10. Distinguish between Pooling of Interest Method and Purchase Method
Ans.
Q11. Is external reconstruction superior to internal reconstruction? [Dec. 2020 - New Syllabus - 5 Marks]
(1) External Reconstruction
(2) Internal Reconstruction
Q12. There are certain departures in accounting aspects dealing with amalgamations or mergers as per IFRS-3 in comparison to IND-AS 103. Enlist such variations briefly. [June 2021 - New Syllabus - 5 Marks] Ans.
Q13. When does goodwill arise on amalgamation? Comment on its amortization. How will you estimate the useful life of the goodwill? Differentiate goodwill and capital reserve as per AS-14.
[Dec. 2021 - New Syllabus - 5 Marks]
Ans.
Q14. X Ltd. is considering the proposal to acquire Y Ltd. and their financial information is given below :
X
intend to pay ` 1,40,00,000 in cash for Y Ltd., if Y Ltd.’s market price reflects only its value as a separate entity, calculate the cost of merger :
(
(
i) When merger is financed by cash.
ii) When merger is financed by stock. (Assume that X Ltd. agrees to exchange 5,00,000 shares in exchange of shares in Y Ltd. instead of payment of cash of ` 1,40,00,000).
[June 2022 - New Syllabus - 5 Marks]
7.14
Ans.
(i) When merger financed in Cash:
(ii) When merger financed by stock: Given;
.
CORPORATE RESTRUCTURING INSOLVENCY LIQUIDATION & WINDING-UP (CRILW) CRACKER
AUTHOR : PRASAD VIJAY BHAT , DIVYA BAJPAI
PUBLISHER : TAXMANN
DATE OF PUBLICATION : JULY 2023
EDITION : 6th Edition
ISBN NO : 9789357781497
NO. OF PAGES : 458
BINDING TYPE : PAPERBACK
DESCRIPTION
Rs.595 USD 38
This book is prepared exclusively for the Professional Level of Company Secretary Examination requirement. It covers the questions (topic/sub-topic wise) & detailed answers strictly as per the syllabus of ICSI. The Present Publication is the 6th Edition for CS-Professional | Dec. 2023 Exam. This book is authored by CA Prasad Vijay Bhat and CS Divya Bajpai, with the following noteworthy features:
• Coverage of this book includes
o Fully-Solved Questions of Past Exams; Topic-wise, including:
Solved Paper: CS Professional June 2023 | Suggested Answers
• [Arrangement of Questions] Questions in each chapter are arranged 'sub-topic wise'
• [Important Additional Questions] with Answers are provided
• [Marks Distribution] Chapter-wise marks distribution from June 2019 onwards
• [Past Exam Trend Analysis] from June 2019 onwards
• [ICSI Study Material] Chapter-wise comparison with ICSI Study Material
ORDER NOW