{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/805/20/#05-overview-and-background","source":"FASB Accounting Standards Codification, Basic View","usage":"Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.","topic":"805","topic_title":"Business Combinations","subtopic":"805-20","subtopic_title":"Identifiable Assets and Liabilities, and Any Noncontrolling Interest","section":{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"805-20-05-1","para":"05-1","html":"<div class=\"asc-body\"><div class=\"norm-text\">This Subtopic provides guidance on one aspect of the acquisition method (as described in paragraph <a href=\"/asc/805/10/#805-10-05-4\" class=\"xref\">805-10-05-4</a>)—the recognition and measurement of all of the following:<ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\"><a href=\"/glossary/i/#identifiable\" class=\"term\" title=\"An asset is identifiable if it meets either of the following criteria: It is separable, that is, capable of being separated or divided from the entity and sold, transferred, licensed, rented, or exchanged, either individually or together with a related contract, identifiable asset, or liability, regardless of whether the entity intends to do so. It arises from contractual or other legal rights, regardless of whether those rights are transferable or separable from the entity or from other rights and obligations.\"><span>Identifiable</span></a> assets acquired</div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\">Liabilities assumed</div></li><li class=\"li-norm\"><span class=\"linum\">c</span><div class=\"p\"><a href=\"/glossary/n/#noncontrolling-interest\" class=\"term\" title=\"The portion of equity (net assets) in a subsidiary not attributable, directly or indirectly, to a parent. A noncontrolling interest is sometimes called a minority interest.\"><span>Noncontrolling interests</span></a>, if any, in the <a href=\"/glossary/a/#acquiree\" class=\"term\" title=\"The business or businesses that the acquirer obtains control of in a business combination. This term also includes a nonprofit activity or business that a not-for-profit acquirer obtains control of in an acquisition by a not-for-profit entity.\"><span>acquiree</span></a>.</div></li></ol></div></div>","snippet":"This Subtopic provides guidance on one aspect of the acquisition method (as described in paragraph 805-10-05-4)—the recognition and measurement of all of the following:\n(a) Identifiable assets acquired\n(b) Liabilities as…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:270ee90cdf88b15c3db04ee5d12a7f4894e9108eac3b2f35c985b1d73673bb5a","downloaded_from":"2026-09-10T01:23:09.220Z","last_downloaded_at":"2026-09-10T01:23:09.220Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480104","source_sha256":"f6d1e058914c709a50453fbcc3f56a17b3e3dc5e34e734da412f486b79b2538d"}},{"citation":"805-20-05-2","para":"05-2","html":"<div class=\"asc-body\"><div class=\"norm-text\">The remaining aspects of the acquisition method are addressed in Subtopics <a altsource=\"GUID-4F5CD9E3-D073-4C55-8027-07F6D2F8A035.ditamap\" class=\"ditamap\">805-10</a> and <a altsource=\"GUID-2B6707CB-355A-4E7A-8901-9529CE2DB325.ditamap\" class=\"ditamap\">805-30</a>. Subtopic 805-30 addresses the recognition and measurement of <a href=\"/glossary/g/#goodwill\" class=\"term\" title=\"An asset representing the future economic benefits arising from other assets acquired in a business combination, acquired in an acquisition by a not-for-profit entity, or recognized by a joint venture upon formation that are not individually identified and separately recognized. For ease of reference, this term also includes the immediate charge recognized by not-for-profit entities in accordance with paragraph 958-805-25-29.\"><span>goodwill</span></a> or a gain from a bargain purchase. Subtopic 805-10 addresses all of the following: <ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\">Identification of the <a href=\"/glossary/a/#acquirer\" class=\"term\" title=\"The entity that obtains control of the acquiree. However, in a business combination in which a variable interest entity (VIE) is acquired, the primary beneficiary of that entity always is the acquirer. (P) December 16, 2026; (N) December 16, 2026805-10-65-5The entity that obtains control of the acquiree.See paragraphs 805-10-25-4805-10-25-5 for guidance on determining the acquirer.\"><span>acquirer</span></a></div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\">Determination of the <a href=\"/glossary/a/#acquisition-date\" class=\"term\" title=\"The date on which the acquirer obtains control of the acquiree.\"><span>acquisition date</span></a></div></li><li class=\"li-norm\"><span class=\"linum\">c</span><div class=\"p\">Particular types of <a href=\"/glossary/b/#business-combination\" class=\"term\" title=\"A transaction or other event in which an acquirer obtains control of one or more businesses. Transactions sometimes referred to as true mergers or mergers of equals also are business combinations. See also Acquisition by a Not-for-Profit Entity.\"><span>business combinations</span></a></div></li><li class=\"li-norm\"><span class=\"linum\">d</span><div class=\"p\">Measurement period</div></li><li class=\"li-norm\"><span class=\"linum\">e</span><div class=\"p\">Determination of what is part of a business combination.</div></li></ol></div></div>","snippet":"The remaining aspects of the acquisition method are addressed in Subtopics 805-10 and 805-30. Subtopic 805-30 addresses the recognition and measurement of goodwill or a gain from a bargain purchase. Subtopic 805-10 addre…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:28069aba73c6a5b23da04065bdae2fd824e1e915829d5a56ea0acaa63c40adc7","downloaded_from":"2026-09-10T01:23:09.220Z","last_downloaded_at":"2026-09-10T01:23:09.220Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480104","source_sha256":"f6d1e058914c709a50453fbcc3f56a17b3e3dc5e34e734da412f486b79b2538d"}},{"citation":"805-20-05-3","para":"05-3","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_794E6645-6E92-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">The guidance in this Subtopic is presented in the following two Subsections:</span></span><ol class=\"ol-norm\"><li class=\"li-norm\"><span class=\"linum\">a</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_794E6725-6E92-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">General</span></span></div></li><li class=\"li-norm\"><span class=\"linum\">b</span><div class=\"p\"><span class=\"sfragment\" id=\"sfr_794E67D9-6E92-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">Accounting Alternative.</span></span></div></li></ol></div></div>","snippet":"The guidance in this Subtopic is presented in the following two Subsections:\n(a) General\n(b) Accounting Alternative.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:93b4e8109a39412788c08d3bbe425f4053a7e5306caad317cf9f695238825845","downloaded_from":"2026-09-10T01:23:09.220Z","last_downloaded_at":"2026-09-10T01:23:09.220Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480104","source_sha256":"f6d1e058914c709a50453fbcc3f56a17b3e3dc5e34e734da412f486b79b2538d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7ec5f9a476ac3417243324199491f1b3a9339732e146abb96081bd4770fa89ba","downloaded_from":"2026-09-10T01:23:09.220Z","last_downloaded_at":"2026-09-10T01:23:09.220Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480104","source_sha256":"f6d1e058914c709a50453fbcc3f56a17b3e3dc5e34e734da412f486b79b2538d"}},{"block":"Accounting Alternative","heading":null,"paragraphs":[{"citation":"805-20-05-4","para":"05-4","html":"<div class=\"asc-body\"><div class=\"norm-text\"><span class=\"sfragment\" id=\"sfr_7959DA42-6E92-1014-A13F-6E4B94C84136\"><span class=\"sfragment-source\">The Accounting Alternative Subsections of this Subtopic provide guidance for an entity within the scope of paragraph <a href=\"/asc/805/20/#805-20-15-2\" class=\"xref\">805-20-15-2</a> that elects the accounting alternative for the recognition of identifiable intangible assets acquired in a business combination.</span></span></div></div>","snippet":"The Accounting Alternative Subsections of this Subtopic provide guidance for an entity within the scope of paragraph 805-20-15-2 that elects the accounting alternative for the recognition of identifiable intangible asset…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:daec3e6db0d133d481b3eb40d69d66e3df272ff100b4e8805df4c8aaff410f2f","downloaded_from":"2026-09-10T01:23:09.220Z","last_downloaded_at":"2026-09-10T01:23:09.220Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147480104","source_sha256":"f6d1e058914c709a50453fbcc3f56a17b3e3dc5e34e734da412f486b79b2538d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4fcfb12c618c295f3f3a4c8a044757442045408b147994738b1b909b81f8cebb","downloaded_from":"2026-09-10T01:23:09.220Z","last_downloaded_at":"2026-09-10T01:23:09.220Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval 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