Mergers and Acquisitions: Business Strategies for Accountants, 2006 Cumulative Supplement, 2nd Edition

by William J. Gole; Joseph Morris (Contributing Author, Charles A. Hawes)

• ISBN13: 9780471464716
• ISBN10: 0471464716
• Edition: 2nd
• Format: Paperback
• Copyright: 2006-04-01
• Publisher: WILEY

Summary

The 2006 Cumulative Supplement contains the following new chapters: Chapter 2A: Preparing for and Executing Due Diligence Appendix 2A.1: Illustrative Information Request: XYZ Software Co. Chapter 3A: Divestitures Appendix 3A.1: Illustrative Divestiture Timeline

Author Biography

William J. Gole is a business consultant, educator, and author of professional books and continuing professional education courses for accountants and other financial professionals. From 1986 to 2003, he was a senior executive at a number of operating companies affiliated with The Thomson Corporation. Most recently, he was senior vice president, Planning and Business Development, at Thomson Healthcare, a $500 million information company serving healthcare professionals with database, newsletter, and medical education products. In that capacity he had responsibility for strategic planning and M&A activity, and managed the acquisition and divestiture of over fifty properties.
Prior to that assignment, he was senior vice president for Worldwide Sales and Services for Thomson Scientific, an internationally renowned scientific database publisher with offices in Philadelphia, San Diego, London, Tokyo, Seoul, and Singapore. In that role, he had responsibility for international sales, customer education, and customer service. He has also held positions as president and chief executive officer of Frost & Sullivan, an international market research publisher; as publisher at the American Institute of CPAs; and as senior auditor with Coopers & Lybrand.
Mr. Gole has authored or co-authored several books, including Guide to Small Business Consulting Engagements and Guide to Construction Contractors, published by Practitioners Publishing Company, and over twenty continuing professional education courses on accounting and consulting services. He has also taught accounting and business courses at a number of colleges and universities in the New York metropolitan area, and currently teaches a course on International Business at Molloy College in Rockville Centre, New York.

Joseph M. Morris is an accounting, tax, and general business consultant and an author of professional books for practicing accountants and other financial professionals. From 1988 to 1990, he was a project manager for the FASB. At the FASB, Mr. Morris was responsible for the major project on consolidations and related matters, which included accounting for consolidated financial statements and parent-subsidiary relationships, accounting for acquisitions, and accounting for joint ventures. He was also the FASB staff specialist in accounting for the software industry.
From 1966 to early 1999, he was senior vice president and chief financial officer and a member of the board of directors of ITEX Corporation, a publicly traded company, which provides diversified financial services and operates the largest organized commercial barter exchange. Previously, he was vice president and corporate controller of Scientific Software-Intercomp, Inc., a publicly traded NASDAQ company. Earlier in his career, Mr. Morris worked extensively on acquisitions in private industry while with Lone Star Industries, Inc., and in public accounting while with Coopers & Lybrand LLP.
Mr. Morris has authored several other Wiley books, including Software Industry Accounting, which received the Association of American Publishers award for Best New Professional Book in Accounting Practice for 1993. The first edition of his book, Mergers and Acquisitions, received the Association of American Publishers award for Best New Professional Book in Accounting Practice for 1995.

Table of Contents

Preface	xv
Acknowledgments	xvii
Acquisitions --- A Business and Legal Overview	1	(8)
James R. Krendl
Krendl Krendl Sachnoff
Noncompetition Covenants (New)	1	(8)
Preparing for and Executing Due Diligence (New)	9	(30)
William J. Gole
Introduction	10	(1)
Key Steps Preceding the Due Diligence Process	11	(7)
Creation of the Due Diligence Team	18	(3)
Development of the Due Diligence Program	21	(3)
Planning Due Diligence	24	(2)
Conducting Due Diligence	26	(2)
Reporting on Due Diligence	28	(2)
A Variation on the Theme: Auctions	30	(9)
Appendix 2A.1 Illustrative Information Request: XYZ Software Co. (New)	33	(6)
Divestitures (New)	39	(20)
William J. Gole
Introduction	40	(1)
Divestiture Rationales	40	(2)
Predivestiture Issues and Considerations	42	(4)
Divestiture Planning	46	(5)
Preparation for the Transaction	51	(2)
Execution of the Transaction	53	(6)
Appendix 3A.1 Illustrative Divestiture Timeline	57	(2)
Accounting for Business Combinations: Overview	59	(12)
Joseph M. Morris
General	60	(4)
The Purchase Method and the Pooling-of-Interests Method	64	(2)
Final FASB Statement, Previous Exposure Draft, and History of the Business Combinations Project	66	(4)
FASB Consolidation Project	70	(1)
The Pooling-of-Interests Method	71	(2)
Joseph M. Morris
Conditions for the Use of the Pooling-of-Interests Method	71	(2)
Purchase Accounting	73	(16)
Joseph M. Morris
General Principles of Purchase Accounting	73	(2)
Determining the Cost of an Acquisition	75	(1)
Recording Assets Acquired and Liabilities Assumed	75	(1)
Purchase Accounting in Special Areas	76	(8)
Financial Reporting of a Purchase Acquisition	84	(5)
Federal Income Taxation of Acquisitions	89	(4)
Greg A. Dickey
IRC Section 338	89	(1)
Tax-Free Mergers and Acquisitions	90	(1)
Miscellaneous Tax Considerations	91	(2)
The Independent Accountant's Role in Acquisitions	93	(2)
James N. Brendel
Auditing Postacquisition Financial Statements of an Acquirer	93	(2)
Securities and Exchange Commission and Other Regulatory Requirements	95	(10)
Robert J. Puls
Mark W. Lindsey
Solicitation and Preparation of Proxies	96	(1)
Tender Offers	97	(3)
SEC Financial Reporting Requirements	100	(2)
Unique SEC Accounting Requirements	102	(3)
Cumulative Index	105