CERTYNEX IFRS ACADEMY

Just before 1 April, Pélan SA held 30 per cent of Quercy SA, its associate. On 1 April, it acquires a further 40 per cent and obtains control of Quercy. Case data: Quercy is a business. How should the transaction be classified?

A business combination achieved in stages: the 30 per cent interest is remeasured at fair value, which enters the goodwill calculation.

A mere additional purchase of shares: the 30 per cent stays at its carrying amount in the goodwill calculation.

A combination whose acquisition date is the date of the 30 per cent purchase, Pélan's first investment.

It is not a business combination, since Pélan already held an interest in Quercy.