ceding of control

Broad Transactions1

1. 805-958Not-for-Profit Entities805 Business Combinations

   ASC 958-805 (indexed here as 805-958) governs combinations in which a not-for-profit entity is the reporting entity and combines with other NFPs, businesses, or nonprofit activities. If the participating governing boards cede control to a new NFP, the transaction is a merger accounted for under the carryover method (combine GAAP carrying amounts, no fresh start, no new assets); if one entity obtains control of the other, it is an acquisition accounted for under the acquisition method with NFP-specific rules for identifying the acquirer, goodwill, and inherent contributions.