Talking Cents

Small business accountants in Melbourne explain how they handle accounting for business combinations

A business combination is a transaction or other event in which an acquirer obtains control of one or more businesses. As small business accountants in Melbourne, it is important to remember that a business is more than just a group of assets. It is an integrated set of activities that can be conducted and managed.

It is necessary for our business accountants in Melbourne to understand the nature of the business combination. There are five general types of business combinations and this includes when:

- A business acquires all assets and liabilities of another business, however, the other business remains as a shareholder
- A business acquires all assets and liabilities of a business that has liquidated
- Two businesses liquidate and form another business, taking on the previous assets and liabilities
- A business acquires only a part of the assets of another business
- A business buys shares in another business to become the main shareholder

For our Melbourne small business accountants, they must ensure that at acquisition, all assets and liabilities are recorded at their fair value prices.

For more information regarding the handling of business combinations, please contact our small business accountants in Melbourne today.