Study On The Accounting Method Of Business Combination

With the improvement of investment environment and the flow of numerous floating money of the international capital market to china after 9.11, mounting mergers and acquisitions of our country' s enterprises flood in our economy spurred by the tide of M&A worldwide. But both the theory and practice of business combination accounting are still in vague state in our country till now, as a result, the accounting information of business combination disclosed can not reflect the economic essence of business combination, influencing the decision of investors and allocation of security exchanges. Study on business accounting method has far-reaching meaning.This thesis starts with the fundamental theory of business combination accounting. After the concise discussion of the two main methods, it focus on demonstrating the difference between the two methods in the theoretic basis, procedure, accounting result, quality of accounting information and so on; then it depicts elaborately the evolution and debate of the pooling of interest. As regard to the core of purchase method-goodwill, this thesis reveals the evolution, current prevalence and future tendency of the theory and regulations of goodwill through detailed comparative study on the theory and regulations ofAmerican, England and IASC.As to the experienced research, this thesis regards the public companies in Shanghai security exchange as objects to study the current state of business combination accounting in our country. Through deeply analyzing on typical cases and related regulations, we conclude that: the current regulations of business combination accounting do not touch on pooling of interest; the regulations for mergers is purchase method, for acquisitions is not genuine purchase method; purchase and pooling of interest coexists in the practice of business combination in our country now; SEC and Finance of our country tacitly approve pooling of interest.Finally, based on the theory of business combination and the special economical environment in our country, we put forward several suggestions to improve and perfect the business combination accounting in our country after rational ponder on the result of experienced study.