Accounting for Business Combinations

Introduction

The aim of the group assignment is to enhance students’ ability to conduct independent research and apply the knowledge and skills learned in this subject to evaluate various facets of real-world mergers and acquisitions transactions. Students will also have the opportunity to work in groups in preparing a written report of their findings using a format similar to that used by professional consultants in addressing business problems.

 

Objectives

This assessment relates to the following subject and program learning objectives:

  • SLO 1. Apply the regulations that determine accounting and reporting for economic entities.
  • SLO 4. Discuss, in written form, the appropriate accounting treatment applicable in the given circumstances.
  • PLO 2.1. Locate and critically evaluate relevant data and literature to address business problems through a research approach. Critically evaluate data and resources in the context of relevant academic literature.
  • PLO 2.2. Apply critical and creative thinking to address issues in business.

 

Weighting and marks

20% of the total marks for the subject.

 

Group size and composition

The assignment is to be completed in groups of five students. All students in a group must be enrolled in the same tutorial. Group formation is on a voluntary basis and should be done by Week 4. After that, any unmatched students will be allocated to a group by their tutor.

 

Assignment Question

Conduct your own research and analysis on the merger between Afterpay and Touchcorp in 2017 and address the following questions.

 

  1. Discuss the background information on the merger and your evaluation of the choices made. These include the acquisition method used, offer price, offer type (cash or shares), premium, regulatory approvals, etc.
  2. What are the economic rationales behind the merger? You should discuss the rationales from the perspectives of both companies.
  3. Provide a critical evaluation of the acquisition analysis regarding the purchase price, FVINA and goodwill in accordance with AASB 3.
  4. Evaluate the post-acquisition performance of the merged entity, including any subsequent business acquisitions that have been conducted.
  5. Your personal view of the business model and future growth.

Additional information:

While the assignment is largely practical in nature, assignments gaining higher marks will need to refer to academic literature to support arguments, in addition to internet and practitioner-based literature. These can be located through search engines (e.g., Google Scholar) and the UTS library website. You are only to use publicly available information in order to complete this assignment. For example, the internet, annual reports, newspaper, journal articles, databases, and books.

 

Formatting and final submission instructions

 

Cover Sheet and original authorship statement

Each report must be accompanied by a completed cover sheet, including the original authorship statement, signed by all team members (see end of this document). Each member should individually submit a peer review sheet on UTSOnline (see end of this document).

 

Report structure

The assignment is to be written as a professional consulting report. The report must follow the formatting requirements outlined in the UTS Guide to Writing Assignments. The writing guide can be downloaded here: https://www.uts.edu.au/sites/default/files/2018-07/UTS-Business-School-Writing-Guide.pdf

 

Page limits

The report should have a maximum length of 15 pages. The structure and relevant page limits of the final report are as follows:

  • Signed cover sheet (not included in page limit)
  • Table of contents (not included in page limit)
  • Executive summary (max. 150 words)—this summarizes what the report found (past tense) and conclusions. This is different from an essay introduction, which introduces what the report will cover (future tense).
  • Introduction—introduces the companies, industry and the context of the report
  • Main body—includes main text, diagrams, figures and tables
  • Conclusions (max. 200 words)
  • Reference list (not included in page limit)
  • Appendices (not included in page limit)

 

Formatting of text

  • Font: Times New Roman, 12pt
  • Line spacing: double line-spacing
  • Margins: At least 2.54cm for top, bottom, left and right margins

 

Referencing

All sources of information must be referenced in the report using the APA referencing style. Details on this style can be found in the writing guide. Further information can be found here:

https://www.lib.uts.edu.au/help/referencing/apa-referencing-guide

 

Any source referenced ‘in-text’ must be listed in the reference list at the end of the report. Any report that contravenes the referencing policy may draw severe penalties and be referred to the student misconduct committee.