The Research Of Two Methods In Combination On Accounting

Accounting for business combination has an issue concerned both in the field of accounting theory and practice. Using different approach to measure business combination will lead to different accounting result and even different economic result and may also influence the combination itself. FASB and IASB eliminated the pooling of interests method one after another. In the trend of international accounting standard convergence, China retained the pooling of interests method because of her special economical environment.The thesis studies on choosing accounting methods in business combination. It begins with the introduction of the accounting methods; next analyses the motivation of the combinations. It compares the application scopes of the purchase method and the pooling of interests method, analyzes the economical and accounting result when to use the two ways. Coming to the merger and absorption of HUATAI Group as an example, compare the purchase and pooling of interest method of the financial situation, operating results and main financial targets, and the different accounting treatment of the economic consequences. In the end, the thesis discusses combination theory statements and gives some combination scope in counter-strategies for the problems mentioned above.