Documentos de Académico
Documentos de Profesional
Documentos de Cultura
Advanced Accounting
Concepts
Introduction
Advanced
accounting concepts
includes:
Merger or Amalgamation
Combination
of two or more
companies into one company
One or more companies merged
with existing company or
formation of a new company
Income tax act of India uses
amalgamation term for merger
Forms of Merger or
Amalgamation
Absorption
Forms of Merger or
Amalgamation
Absorption
Forms of Merger or
Amalgamation
Consolidation
Forms of Merger or
Amalgamation
Consolidation
Types of Merger
Horizontal
merger
Types of Merger
Horizontal
merger
Advantages :
Avoiding competition
Economics of scale
Marketing economies
Elimination of duplication of facilities
Types of Merger
Vertical
merger
10
Types of Merger
Vertical
merger
For e.g.,
Petroleum company may set up petrol
pump for its selling
Railway company join with coal mining
company for carrying coal
Textile company merge with transport
company for carrying its products to
different places
11
Types of Merger
Conglomerate
merger
12
Types of Merger
Concenetric
merger
13
Types of Merger
Reverse
merger
14
Reasons/Motives/Advantages
behind Merger
Expansion
& Growth
15
Reasons/Motives/Advantages
behind Merger
Diversification
16
Reasons/Motives/Advantages
behind Merger
Economics
of scale
17
Reasons/Motives/Advantages
behind Merger
Synergy
18
Reasons/Motives/Advantages
behind Merger
Market
penetration
leadership
19
Reasons/Motives/Advantages
behind Merger
Utilization
of surplus funds
Risk reduction
New product entry
New market entry
Deployment of surplus funds
Operating economies
20
Benefits of Merger
Diversification
of product and
service offerings
Increase in plant capacity
Larger market share
Utilization of operational
expertise and research and
development (R&D)
Reduction of financial risk
Puja Patil, Assistant Professor, IIBM
21
Cost of Merger
Direct
monetary costs
Legal cost
Consultant fees
Audit fees
Relocation expenses
Logo design & printing expenses
Webpage redesign cost
22
Cost of Merger
Human
Resource cost
23
Merger Process
Defining corporate strategy
24
Merger Process
Defining
corporate strategy
corporate strategy
25
Merger Process
Target
identification
Financial consideration
Business strength
Weaknesses
Specific resource
Competencies & capabilities
Structure, strategies, culture & processes
Market power
Puja Patil, Assistant Professor, IIBM
26
Merger Process
Valuation
of merger
Depend on
Projected synergies after merger
27
Merger Process
Merger
implementation
28
Merger Process
Post-merger
integration
Asset stripping
improving operating efficiency
Setting up managerial system
Streamlining operations of combined firm
Establishing corporate culture
Ensuring competitiveness of combined
firm
Puja Patil, Assistant Professor, IIBM
29
Acquisition or Takeover
Buying
30
Acquisition or Takeover
More
31
Types of Acquisition
Friendly
takeover
32
Types of Acquisition
Hostile
takeover
33
Types of Acquisition
Reverse
takeover
34
Principles of Acquisitions
Transparency
of process
of small shareholder
35
Principles of Acquisitions
Realization
of economic gains
Restructuring operations
Widening of product range
Redeployment of recourses
Suitable fiscal incentives
36
Principles of Acquisitions
No
Financial
support
37
Reasons or Advantages of
Acquisitions
Increased
market power
Overcoming entry barriers
Cost of New product
development
Increased speed to market
Access to resourceful
management
Increased diversification
Learning & developing new
capabilities
38