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A Research Note on Bargain Purchase Gains on Acquisition
Author(s) -
Kabir Humayun
Publication year - 2020
Publication title -
australian accounting review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.551
H-Index - 36
eISSN - 1835-2561
pISSN - 1035-6908
DOI - 10.1111/auar.12269
Subject(s) - sample (material) , accounting , business , monetary economics , large sample , economics , statistics , mathematics , chemistry , chromatography
This research note explores the incidence, amounts, disclosure and potential sources of bargain purchase gains reported by an Australian sample of firms during 2013–15. It finds that 7.58% of the sample acquirers reported bargain purchase gains during this period. The median gain as a percentage of consideration transferred was 18.90%. In contravention of IFRS 3 Business Combinations , not all acquirers with material bargain purchase gains disclosed in notes why the gain arose. Finally, the note reports preliminary evidence suggesting uncertainty about the sources of the gain.