The date on which the acquirer obtains control of the acquiree generally is the date on which the acquirer legally transfers the consideration (if any), acquires the assets, and assumes the liabilities of the acquiree--the closing date.
As of the acquisition date, the acquirer shall recognize, separately from goodwill, the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree.
For example, costs the acquirer expects but is not obligated to incur in the future to effect its plan to exit an activity of an acquiree or to terminate the employment of or relocate an acquiree's employees are not liabilities at the acquisition date.
In addition, to qualify for recognition as part of applying the acquisition method, the identifiable assets acquired and liabilities assumed must be part of what the acquirer and the acquiree (or its former owners) exchanged (or what was contributed) in the acquisition transaction rather than the result of separate transactions.
The acquirer's application of the recognition principle and conditions may result in recognizing some assets and liabilities that the acquiree had not previously recognized as assets and liabilities in its financial statements.
The acquirer shall measure the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree at their acquisition-date fair values.
Paragraphs A93-A101 provide guidance on measuring the fair value of particular identifiable assets acquired, liabilities assumed, and a noncontrolling interest in an acquiree.
Contingent consideration arrangements of an acquiree assumed by the acquirer in an acquisition shall be recognized initially at fair value in accordance with the guidance for contingent consideration arrangements in paragraph 58.
The acquirer shall account for the potential tax effects of temporary differences, carryforwards, and any income tax uncertainties of an acquiree that exist at the acquisition date or that arise as a result of the acquisition in accordance with Statement 109, as amended, and related interpretative guidance, including FASB Interpretation No.
Unless the operations of the acquiree as part of the combined entity are expected to be predominantly supported by contributions and returns on investments (paragraphs 51 and 52), the acquirer shall recognize goodwill as of the acquisition date, measured as the excess of (a) over (b) below:
2) The fair value of any noncontrolling interest in the acquiree
If the operations of the acquiree as part of the combined entity are expected to be predominantly supported by contributions and returns on investments, the acquirer shall recognize an excess of the amount in paragraph 50(a) over the amount in paragraph 50(b) as a separate charge in its statement of activities as of the acquisition date rather than as goodwill.
The acquirer might transfer consideration to the former owner of the acquiree or to a designee of the former owner.
An asset transferred by the acquirer to an unrelated third party as a required condition of an acquisition shall be accounted for as consideration transferred for the acquiree unless the acquirer retains control over the transferred assets.