Provisionally determined fair values
Entity B acquired Entity C in August 2011 and made a provisional assessment of Entity C”s identifiable net assets in its 31 December 2011 consolidated financial statements under its previous GAAP. In its 31 December 2012 consolidated financial statements – its last financial statements under previous GAAP – Entity B completed the initial accounting for the business combination and adjusted the provisional values of the identifiable net assets and the corresponding goodwill. Upon first-time adoption of IFRSs, Entity B elects not to restate past business combinations.
In preparing its opening IFRS statement of financial position, Entity B should use the adjusted carrying amounts of the identifiable net assets as determined in its 2012 financial statements rather than the provisional carrying amounts of the identifiable net assets and goodwill at 31 December 2011.