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FASB Reporting Requirements For Prior Year Financials

John Shiller's Profile

We are a very small public company (pink sheet) acquiring a division from another company. The acquisition target has been very profitable. The subdivision has maintained separate audited financials. We would like to use the last 3 years of the acquisition to restate our financials. Can we do this? If we positioned it as a merger, could that work?


(Financial Accountant) |

Without knowing your percentage of ownership and timing of acquisition it is difficult to answer. However general answer based on your idea of presenting consolidated financial statement YES you need to reinstate all prior three years of financial statements and show it like it was part of your parent company for comparative purposes and also include key financial statement information in footnotes. Also some information will be displayed before extraordinary items.

Topic Expert
Barrett Peterson
Title: Senior Manager, Actg Stnds & Analysis
Company: TTX
(Senior Manager, Actg Stnds & Analysis, TTX) |

Generally comparative prior periods are required in public company financials, and reporting for acquisitions prescribes presenting comparative prior periods as though the acquisition occured as of the start of the earliest period presented. Other disclosures or select acquiree data is also required.


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