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Amalgamation Exchange Ratio And The Choice Of Accounting Methods

Posted on:2004-05-22Degree:MasterType:Thesis
Country:ChinaCandidate:D H LiFull Text:PDF
GTID:2206360122967075Subject:Accounting
Abstract/Summary:PDF Full Text Request
Acquisition by exchange of stock is still at the primary stage. There are many problem during the process of development, such as asset valuation in acquisition . standards of acquisition process, ration for the exchange of stock and accounting methods for acquisition.The initiative of acquisition mainly lives in two aspects: firstly why to acquire, this can be explored in economic management and strategy of an enterprise's development secondly why an enterprise will use the method of exchange of stock, this can be considered in following factors: capital structure, capacity of financing considered in following factors: capital structure, capacity of financing returning earning, decentralized controlling right and laws and regulations.Ration for the exchange of stock is the key problem in the acquisition. The ratio can be determined by net asset per share, earning per share, market per share and L-G model. However, these method are defective in our country failing to satisfied the need for them to be applied. Considering the present situation of our capital of market, it is suggested in this thesis we adopt the mark-on percentage is determined in terms of non-operation assets and stock's ability to flow. This method in a better way present inner values of both sides, achieving reciprocity in exchange.There are purchase method, Pooling method and fresh-start method in accounting methods dealing with acquisition by exchange of stock, whereas fresh-start method has not been in use. The economic essence of acquisition by exchange of stock and the uncertainty of a reasonable fair price in our capital market which hinders the usage of purchase method means acquisition by exchange of stock is appropriate choice.By analyzing the case of LuXi chemical Industry, we can see they combined in order to realized the exchange of stock is determined on the basis of net assets, but too many factors out of financial report , like being a listed company, were taken into consideration, However, Not adequate attention was paid to the quality of assets, which led to disadvantages for stock holders of LuPing. According to the financial index, like profit, of contemporary period and next periods, pooling method is superior to purchase method.
Keywords/Search Tags:Acquisition by exchange of stock, Ration for the exchange of stock, Purchase method, Pooling method
PDF Full Text Request
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