FASB's Rules for Pushdown Accounting
Gain a better understanding of the FASB guidance and when it should be used.
Companies prepare separate financial statements of their subsidiaries for various reasons, such as spin-offs, regulatory requirements, or compliance with debt covenants. Pushdown accounting establishes a new basis for reporting assets and liabilities in the acquiree’s separate financial statements based on a pushdown of the acquirer’s new bases. Pushdown typically results in stepping up the basis of assets and liabilities to fair value and recording goodwill in the acquiree’s financial statements. This course expounds on the fundamental concepts of pushdown accounting.
• You will be able to define pushdown accounting and its application to different types of business ventures.
• You will be able to describe reasons acquirers choose to push down their fair values to step up the basis of assets and liabilities in the acquirees’ financial statements.
• You will be able to discuss the implications of pushdown accounting on different assets and liabilities.
• You will be able to explain the impact of pushdown accounting on disclosure requirements.