When Is Pushdown Accounting Applied?

Sometimes the acquiree will prepare separate financial statements after its acquisition. Use of the acquirer's basis of accounting in the preparation of an acquiree's separate financial statements is called “pushdown accounting.” In November 2014, the FASB issued ASU 2014-17, which became effective upon issuance.

Is pushdown accounting required?

Pushdown accounting is now optional for all companies that have been acquired in a business combination. This gives acquired companies a choice between carrying over their old accounting basis or refreshing their accounting basis based on the acquisition date fair values recognized by the acquirer.

Is push down accounting allowed under IFRS?

Push-down accounting is not permitted under IFRS, and therefore the US company may have to maintain two sets of IFRS numbers: one for the parent consolidation and one for its stand-alone financial statements.