IFRS for SMEs) IFRS for SMEs Business Combinations and Goodwill 2

Question 1

In a business combination under IFRS for SMEs, which of the following would qualify for separate recognition as an intangible asset apart from goodwill?

Accepted Answer

A customer list that is separable and can be sold independently

Answer

A customer list that can be separated and sold independently meets the separability criterion and is recognized as an intangible asset apart from goodwill.

Question 2

Under IFRS for SMEs, contingent consideration in a business combination is included in the cost of the combination only if:

Accepted Answer

Payment is probable and the amount can be measured reliably

Answer

IFRS for SMEs Section 19 includes contingent consideration in the combination cost only when payment is probable and the amount can be measured reliably.

Question 3

Under IFRS for SMEs, non-controlling interest (NCI) in a business combination is measured at:

Accepted Answer

NCI's proportionate share of the acquiree's identifiable net assets

Answer

IFRS for SMEs requires NCI to be measured at the proportionate share of identifiable net assets; the option to measure at fair value (as in full IFRS) is not available.

Question 4

Under IFRS for SMEs, a contingent liability of the acquiree is recognized at the acquisition date if:

Accepted Answer

It represents a present obligation and its fair value can be measured reliably

Answer

IFRS for SMEs recognizes an acquiree's contingent liabilities in a business combination only when they represent present obligations whose fair values can be reliably measured.

Question 5

How is goodwill presented in the statement of financial position under IFRS for SMEs?

Accepted Answer

As an intangible asset within non-current assets

Answer

Goodwill is classified as an intangible asset and presented within non-current assets on the statement of financial position.

IFRS for SMEs (IFRS for Small and Medium-sized Entities (SMEs)) Practice Test

IFRS for SMEs (IFRS for Small and Medium-sized Entities (SMEs)) Practice Test

IFRS for SMEs) IFRS for SMEs Business Combinations and Goodwill 2