What is amalgamation according to AS 14?
Amalgamation means an amalgamation pursuant to the provisions of the Companies Act, 2013 or any other statute which may be applicable to companies and includes ‘merger’. Transferor company means the company which is amalgamated into another company.
What is the meaning of amalgamation in accounting?
An amalgamation is a combination of two or more companies into a new entity. Amalgamation is distinct from a merger because neither company involved survives as a legal entity. Instead, a completely new entity is formed to house the combined assets and liabilities of both companies.
What are the two methods of accounting for amalgamation as per Accounting Standard 14?
There are two main methods of accounting for amalgamations: (a) the pooling of interests method; and (b) the purchase method. 8. The use of the pooling of interests method is confined to circumstances which meet the criteria referred to in paragraph 3(e) for an amalgamation in the nature of merger. 9.
What are the scope of AS 14?
AS 14 – Accounting for Amalgamations. Purpose and Scope: This statement deals with accounting for amalgamations and the treatment of any resultant goodwill or reserves.
What is amalgamation and its types?
There are two types of amalgamation, including merger and purchase methods. In both cases, the legal entity of the preexisting companies vanishes, replaced by a new company with combined assets and liabilities.
What is the term of amalgamation?
Definition of amalgamation 1a : the action or process of uniting or merging two or more things : the action or process of amalgamating an opportunity for the amalgamation of the two companies. b : the state of being amalgamated.
What are types of amalgamation?
What are the types of amalgamation?
What are the conditions which according to AS 14 on accounting for amalgamations must be satisfied for an amalgamation in the nature of merger?
As per standard, an amalgamation should be considered to be an “amalgamation in the nature of merger” when all the following conditions are satisfied: All assets and liabilities of the transferor company become, after amalgamation, the assets, and liabilities of the transferee company.
What is amalgamation process?
amalgamation process əmăl˝gəmā´shən [key], in particular, a method to extract gold and silver from ores. The ore is crushed and treated with mercury, in which the metal dissolves. The amalgam is heated and the mercury evaporates, leaving pure gold or silver.
What is amalgamation and example?
In accounting, an amalgamation, or consolidation, refers to the combination of financial statements. For example, a group of companies reports their financials on a consolidated basis, which includes the individual statements of several smaller businesses.
What is amalgamation and types?
What is the word amalgamation mean?
What is an example of amalgamation?
Two good examples of amalgamations are as follows: Maruti Motors operating in India and Suzuki based in Japan amalgamated to form a new company called Maruti Suzuki (India) Limited. Tata Sons operating in India and AIA Group based in Hong Kong amalgamated to form a new company called TATA AIG Life Insurance.