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161 ratings

Michael Kustanovich, CPA

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Advanced Financial Reporting: Accounting for Business Combinations and Preparation of Consolidated Financial Statements

University of Illinois at Urbana-Champaign

About this Course

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This course covers the accounting for business combinations (ASC 805), the preparation of consolidated financial statements (ASC 810), and other related topics including, but not limited to: step-by-step acquisition, deconsolidation, segments reporting, and the goodwill impairment test. This course begins with a discussion of the scope of ASC 805 and the differences between business combinations and asset acquisitions. Next, the course explores the measurement and recognition principles of the acquisition method to account for business combinations. Then, the course covers the consolidation process. You will learn how to prepare the consolidated financial statements and make all of the necessary consolidation adjustments.

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Coursera Labs

Includes hands on learning projects.

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Advanced Level

Approx. 24 hours to complete

English

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Flexible deadlines

Reset deadlines in accordance to your schedule.

Shareable Certificate

Earn a Certificate upon completion

100% online

Start instantly and learn at your own schedule.

Coursera Labs

Includes hands on learning projects.

Learn more about Coursera Labs

Advanced Level

Approx. 24 hours to complete

English

Could your company benefit from training employees on in-demand skills?

Try Coursera for Business

Instructor

Instructor rating

4.6/5 (64 Ratings)

Michael Kustanovich, CPA

Clinical Assistant Professor of Accountancy

Accountancy

15,247 Learners

1 Course

Offered by

University of Illinois at Urbana-Champaign

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This course is part of the Master of Science in Accountancy (iMSA) from University of Illinois at Urbana-Champaign. If you are admitted to the full program, your coursework will count towards your degree learning and all of your progress will transfer with you.

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Syllabus - What you will learn from this course

Week1

Week 1

1 hour to complete

Course Orientation

1 hour to complete

3 videos (Total 5 min), 4 readings, 1 quiz

3 hours to complete

Module 1: Control of a Business

3 hours to complete

5 videos (Total 30 min), 1 reading, 5 quizzes

5 videos

Overview of Accounting for Investment in Equity Securities – Part 17mOverview of Accounting for Investment in Equity Securities – Part 27mControl4mScope of ASC 805 – "Business Combinations"3mAcquisition of a Group of Assets6m

1 reading

Module 1 Overview and Resources10m

5 practice exercises

Lesson 1-1 Knowledge Check30mLesson 1-2 Knowledge Check30mLesson 1-3 Knowledge Check30mLesson 1-4 Knowledge Check30mModule 1 Quiz

Week2

Week 2

2 hours to complete

Module 2: Acquisition Method

2 hours to complete

4 videos (Total 30 min), 1 reading, 4 quizzes

Week3

Week 3

2 hours to complete

Module 3: Components of Consideration Transferred in a Business Combination

In this module, you will be introduced to different components of consideration transferred in a business combination. You will learn the measurement principles of share-based payment awards and will examine a real-life merger between Express Scrips and Medco companies. Moreover, you will be introduced to the concept of contingent consideration and learn the methods to classify, recognize, and record contingent considerations.

2 hours to complete

4 videos (Total 36 min), 1 reading, 3 quizzes

Week4

Week 4

3 hours to complete

Module 4: Assets Acquired and Liabilities Assumed

In this module, you will gain a deeper understanding of the assets acquired and liabilities assumed in a business combination. You will be introduced to different types of identifiable assets acquired, such as defensive intangible assets and in-process research and development (IPR&D), and the rules to recognize and measure them under US GAAP and IFRS. You will also learn the difference between a taxable transaction and a non-taxable transaction, and how to calculate deferred taxes on an acquisition date.

3 hours to complete

5 videos (Total 35 min), 1 reading, 5 quizzes

5 videos

Identifiable Assets Acquired7mIntangible Assets Other Than Goodwill5mDefensive Asset and In-Process Research and Development (IPR&D)6mDeferred Taxes on the Acquisition Date – Part 19mDeferred Taxes on the Acquisition Date – Part 26m

1 reading

Module 4 Overview and Resources10m

5 practice exercises

Lesson 4-1 Knowledge Check30mLesson 4-2 Knowledge Check30mLesson 4-3 Knowledge Check30mLesson 4-4 Knowledge Check30mModule 4 Quiz

Week5

Week 5

3 hours to complete

Module 5: Preparation of Consolidated Financial Statements after the Acquisition Date

In this module, you will learn how to prepare the consolidated financial statements after the acquisition date. The concept of accounting acquisition premium (AAP), and the methods to calculate identifiable and unidentifiable portions of the accounting acquisition premium will be introduced. You will also learn the effects of accounting acquisition premium on the consolidated financial statements and the relevant consolidation adjustments. Moreover, you will be introduced to intercompany inventory transactions and learn to make consolidation adjustments for intercompany inventory sales and intercompany inventory profits.

3 hours to complete

5 videos (Total 44 min), 1 reading, 5 quizzes

5 videos

Accounting Acquisition Premium (AAP)6mThe Effect of AAP on Consolidated Financial Statements6mConsolidated Financial Statements with AAP – Part 18mConsolidated Financial Statements with AAP – Part 27mIntercompany Inventory Transactions14m

1 reading

Module 5 Overview and Resources10m

5 practice exercises

Lesson 5-1 Knowledge Check30mLesson 5-2 Knowledge Check30mLesson 5-3 Knowledge Check30mLesson 5-4 Knowledge Check30mModule 5 Quiz

Week6

Week 6

4 hours to complete

Module 6: Intercompany Transactions and Noncontrolling Interest

In this module, you will be introduced to more types of intercompany transactions as well as noncontrolling interests. You will learn the consolidation adjustments for intercompany transactions with depreciable assets and intercompany debt. The noncontrolling interest (NCI) will be introduced. You will learn the definition, calculation, and presentation of noncontrolling interest and net income attributable to NCI in the consolidated financial statements. You will also learn how to report consolidated retained earnings and the subsequent measurement of noncontrolling interests. Lastly, an example of consolidation with noncontrolling interest will be shown.

4 hours to complete

6 videos (Total 46 min), 1 reading, 7 quizzes

6 videos

Intercompany Transactions with Depreciable Assets5mIntercompany Debt5mNoncontrolling Interest (NCI)8mNet Income Attributable to NCI10mConsolidated Retained Earnings and Subsequent Measurement of NCI4mExample of Consolidation with NCI10m

1 reading

Module 6 Overview and Resources10m

7 practice exercises

Lesson 6-1 Knowledge Check30mLesson 6-2 Knowledge Check30mLesson 6-3 Knowledge Check30mLesson 6-4 Knowledge Check30mLesson 6-5 Knowledge Check30mLesson 6-6 Knowledge Check30mModule 6 Quiz

Week7

Week 7

3 hours to complete

Module 7: Change in the Percentage of Ownership and Other Related Topics

In this module, we will explore the accounting rules for changes in the percentage of ownership of a Subsidiary and other topics that relate to business combinations. You will learn how to account for a business combination that was achieved in stages, and how to calculate the gain or loss on deconsolidation of the Subsidiary. Also, you will be introduced to the situation in which the Subsidiary acquires shares of the Parent and learn the methods to measure and record the transaction.

3 hours to complete

5 videos (Total 34 min), 1 reading, 5 quizzes

5 videos

Business Combination Achieved in Stages – Part 110mBusiness Combination Achieved in Stages – Part 25mDeconsolidation8mChange in the Percentage of Ownership without Loss of Control7mSubsidiary Holds Shares of the Parent3m

1 reading

Module 7 Overview and Resources10m

5 practice exercises

Lesson 7-1 Knowledge Check30mLesson 7-2 Knowledge Check30mLesson 7-3 Knowledge Check30mLesson 7-4 Knowledge Check30mModule 7 Quiz

Week8

Week 8

5 hours to complete

Module 8: Segment Reporting and Goodwill Impairment Test

In this module, you will be introduced to segment reporting and the goodwill impairment test. You will learn the rules for public companies to disclose segment information in the notes to annual and interim financial statements. You will also learn what information should be presented in the entity-wide disclosures, and when. Then, the methods for identifying the reporting units, qualitative assessment for goodwill impairment, and the quantitative one-step goodwill impairment test will be introduced. You will also learn the goodwill impairment test under IFRS and the rules for private companies to account for goodwill.

5 hours to complete

8 videos (Total 42 min), 3 readings, 8 quizzes

8 videos

Segment Reporting13mEntity-Wide Disclosure2mGoodwill Impairment Test – Identification of the Reporting Units5mGoodwill Impairment Test – Qualitative Assessment3mOne-Step Quantitative Goodwill Impairment Test3mGoodwill Impairment Test Under IFRS7mPrivate Companies Accounting for Goodwill2mGies Online Programs3m

3 readings

Module 8 Overview and Resources10mCongratulations!10mGet Your Course Certificate10m

8 practice exercises

Lesson 8-1 Knowledge Check30mLesson 8-2 Knowledge Check30mLesson 8-3 Knowledge Check30mLesson 8-4 Knowledge Check30mLesson 8-5 Knowledge Check30mLesson 8-6 Knowledge Check30mLesson 8-7 Knowledge Check30m Module 8 Quiz

Reviews

4.7

55 reviews

5 stars
79.50%
4 stars
16.14%
3 stars
1.24%
2 stars
0.62%
1 star
2.48%

TOP REVIEWS FROM ADVANCED FINANCIAL REPORTING: ACCOUNTING FOR BUSINESS COMBINATIONS AND PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS

by AASep 1, 2020

Good to equip yourself with, and very informative on business mergers.

by SOJun 8, 2020

I learnt more from the course. It was an interesting experience.

by KBMar 6, 2022

The lessons were very well presented, the examples given to help understand the theories were adequate and very helpful. It is a course I would recommend to anyone interested in financial reporting.

by NKSep 16, 2021

I just have a problem with teacher's hand writing .

View all reviews

Frequently Asked Questions

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Access to lectures and assignments depends on your type of enrollment. If you take a course in audit mode, you will be able to see most course materials for free. To access graded assignments and to earn a Certificate, you will need to purchase the Certificate experience, during or after your audit. If you don't see the audit option:
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The course may offer 'Full Course, No Certificate' instead. This option lets you see all course materials, submit required assessments, and get a final grade. This also means that you will not be able to purchase a Certificate experience.
What will I get if I purchase the Certificate?
When you purchase a Certificate you get access to all course materials, including graded assignments. Upon completing the course, your electronic Certificate will be added to your Accomplishments page - from there, you can print your Certificate or add it to your LinkedIn profile. If you only want to read and view the course content, you can audit the course for free.
Is financial aid available?
Yes. In select learning programs, you can apply for financial aid or a scholarship if you can’t afford the enrollment fee. If fin aid or scholarship is available for your learning program selection, you’ll find a link to apply on the description page.

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Advanced Financial Reporting: Accounting for Business Combinations and Preparation of Consolidated Financial Statements

Advanced Financial Reporting: Accounting for Business Combinations and Preparation of Consolidated Financial Statements

About this Course