IASB Publishes Exposure Draft – Business Combinations – Disclosures, Goodwill and Impairment

The IASB undertook a project Business Combinations – Disclosures, Goodwill and Impairment to explore ways to address stakeholders’ concerns. As a culmination of the project, the IASB has now issued an Exposure Draft - Business Combinations – Disclosures, Goodwill and Impairment proposing amendments to IFRS 3 and IAS 36. The Exposure Draft proposes to introduce additional disclosure requirements in IFRS 3 that will require entities to provide information about the strategic rationale, expected synergies and the actual performance of acquisitions in the year of acquisition and in reporting periods after the acquisition. The Exposure Draft also proposes certain amendments to IAS 36 to make targeted improvements to the impairment test, with an objective to reduce shielding of goodwill from impairments being recognised and to simplify the impairment test.

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