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IFRS® Accounting Standards

Business Combinations – Disclosures, Goodwill and Impairment

Summary

The AcSB is participating in the IASB's initiative to enhance IFRS 3 Business Combinations and IAS 36 Impairment of Assets. The project aims to address the IFRS 3 Post‑implementation Review feedback.

The feedback highlighted insufficient information in the financial statements for investors to understand the performance of an acquired business. Respondents also emphasized the potential ineffectiveness of the goodwill impairment test due to untimely recognition. Proposed amendments include enhancing business combination disclosure under IFRS 3 and modifying the goodwill impairment test in IAS 36.

The AcSB’s due process includes ensuring that Canadian entities’ financial reporting needs are considered by the IASB and issuing the AcSB’s own exposure draft on each IASB proposal. Subject to the responses to the AcSB’s exposure draft on whether the IASB’s proposals are appropriate for application in Canada, the AcSB expects that the amendments will be incorporated into Canadian GAAP in accordance with the AcSB’s strategy of adopting IFRS® Accounting Standards for publicly accountable enterprises.

Staff Contact(s)

Jayshal Rajendra Daya, CPA, CA Principal, Accounting Standards Board

Project Status

  • Information gathering

    Research activities to inform the scope of the project, including issuance of the IASB’s Discussion paper, public outreach, and deliberation of feedback completed prior to December 2022

  • Approving project

    The IASB moved the project from its research programme to the standard-setting programme in December 2022

  • Engaging Communities

    The IASB issued its Exposure Draft, Business Combinations—Disclosures, Goodwill and Impairment in March 2024

    The AcSB issued its Exposure Draft, which corresponds to the IASB Exposure Draft in April 2024

  • Deliberating feedback
  • Final pronouncement

Exposure Draft, Business Combinations – Disclosures, Goodwill and Impairment

News


April 23, 2024

Document for Comment, International Activity, News

AcSB Exposure Draft – Business Combinations – Disclosures, Goodwill and Impairment

The AcSB issued its Exposure Draft that corresponds to the IASB’s Exposure Draft on this topic. If you would like your feedback considered prior to our Board finalizing our comment letter, please respond by June 14, 2024. 

April 15, 2024

International Activity, News, Resource, Guidance

What You Need to Know about IASB’s Exposure Draft “Business Combinations – Disclosure, Goodwill and Impairment”

Read our overview of the IASB’s Exposure Draft “Business Combinations – Disclosures, Goodwill and Impairment,” and how it impacts your business. The proposed amendments affect how entities perform their goodwill impairment assessments and enhance disclosure requirements for business combinations. 

March 19, 2024

International Activity, Document for Comment, News

IASB Exposure Draft – Business Combinations – Disclosures, Goodwill and Impairment

The IASB has published an Exposure Draft, “Business Combinations – Disclosures, Goodwill and Impairment,” which proposes amendments to IFRS 3 Business Combinations and IAS 36 Impairment of Assets. Respond directly to the IASB with your feedback by July 15, 2024. In addition, stay tuned for opportunities to participate in our consultation activities, and help inform our response to the IASB.

January 13, 2021

International Activity

AcSB Response – Business Combinations—Disclosures, Goodwill and Impairment

On December 16, 2020, the AcSB responded to the IASB’s Discussion Paper, issued in March 2020. The IASB’s proposals take significant steps forward towards improving the accounting for goodwill and enhancing the relevance of information about acquisitions. The AcSB’s letter encourages the IASB to consider areas where additional guidance is needed to address possible application challenges that may arise. Read our letter to find out more!

April 21, 2020

International Activity

UPDATE – IASB amends workplan and timelines

On April 17, 2020, the IASB voted to issue an Exposure Draft with a 30-day comment period proposing to extend by one year the effective date of an amendment to IAS 1 Presentation of Financial Statements. The IASB also decided to extend by three months the comment period for: Exposure Draft, General Presentation and Disclosures, Request for Information Comprehensive Review of the IFRS for SMEs Standard and Discussion Paper, Business Combinations – Disclosures, Goodwill and Impairment. The IASB also deferred the timelines for various upcoming consultation documents and final amendments.  See the IASB’s workplan for more information.

April 14, 2020

International Activity

IASB Snapshot – IFRS® Standards Discussion Paper, Business Combinations—Disclosures, Goodwill and Impairment

How can companies provide a financial statement user with better information about business combinations? The IASB’s Discussion Paper: Business Combinations—Disclosures, Goodwill and Impairment investigates this through possible improvements to IFRS 3 Business Combinations and IAS 36 Impairment of Assets. Don’t have time to read the Discussion Paper? The IASB’s Snapshot provides an easy-to-understand overview of this paper that can help support you as you form your views on the proposals. Read it today!

Meeting & event summaries


July 9, 2024

AcSB Decision Summary – June 19-20, 2024

The AcSB discussed key points to include in its response to the International Accounting Standards Board’s (IASB) Exposure Draft, “Business Combinations – Disclosures, Goodwill and Impairment.” The IASB issued its Exposure Draft in March 2024, with comments due to the IASB by July 15, 2024. In developing the key points to include in its response letter, the AcSB considered feedback from 88 interested and affected parties, including users, preparers, practitioners, valuators, and regulators.

The AcSB discussed users’ concerns about the need for better information on business combinations. This included the need for additional information that is critical for evaluating whether the price an entity paid for a business combination is reasonable, assessing the subsequent performance of the acquired business, and holding management accountable for its investment decisions. The Board considered whether the general-purpose financial reports are the appropriate location within which to provide this information.

Additionally, the Board discussed the importance of carefully considering the feasibility of implementing processes and controls to ensure that the information provided is verifiable at a reasonable cost.

The AcSB will proceed to finalize its response letter to the IASB.

October 27, 2020

AcSB Decision Summary – October 27, 2020

The AcSB began discussing the key issues to include in its response letter to the International Accounting Standards Board (IASB’s) Discussion Paper, “Business Combinations—Disclosures, Goodwill and Impairment.” As part of the discussion, the Board considered stakeholder feedback obtained to date through its outreach on this topic. The Board will consider the results of remaining stakeholder outreach and discuss a draft of its response letter at its December meeting.

The AcSB encourages stakeholders to share their views on the Discussion Paper by submitting their response letters to the IASB by December 31, 2020, with a copy to the AcSB. If respondents would like the Board to consider their comments when drafting its letter to the IASB, they should submit their response letters to the AcSB by November 30, 2020, to allow the Board adequate time to consider the feedback in its response letter.

June 16, 2020

AcSB Decision Summary – June 16, 2020

The AcSB received an education session on the International Accounting Standards Board's Discussion Paper, “Business Combinations—Disclosures, Goodwill and Impairment. The Board also received an update on the remaining outreach planned for the Discussion Paper, including virtual roundtables planned for July and September 2020.

March 3, 2020

AcSB Decision Summary – March 3-4, 2020

The AcSB approved the preliminary plan to respond to the International Accounting Standards Board’s (IASB) upcoming discussion paper related to the Goodwill and Impairment project. The Board also discussed the communication activities it will undertake related to this project. The IASB expects to issue its discussion paper in March 2020.

January 29, 2020

AcSB Decision Summary – January 15, 2020

The AcSB considered a preliminary plan to respond to the International Accounting Standards Board’s (IASB) upcoming discussion paper related to its Goodwill and Impairment project.

The IASB expects to issue its discussion paper in February 2020.

The AcSB will discuss the communication activities related to this project and the final plan to respond to the discussion paper once the IASB issued it.

Disclaimer

This project summary has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on this project, which may change after further Board deliberations. Decisions to publish Handbook material are final only after a formal voting process.