Question please Madamswer or anybody that knows the answer.
When it comes to accounting for the business combination in PRG’s books will the purchase consideration be based on $2.82per PRG share or as the div was already declared and payable before settlement will it be the ex-div value of $2.705??? or some other figure altogether?
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On the issue of unusual outcomes from business combination accounting, I noticed SKE has written of over the last two reports all $4,638,000 contingent consideration on the Broadswood purchase, effectively sending that amount straight to bottom line profit. One wonders why they haven’t correspondingly impaired the goodwill created via the business combination accounting of the said contingent liability?? I guess we are expected to miss the capitalisation of thin air to produce statutory profit in a particular period and of course they don’t call this thing out as an adjustment. Yet when they finally impair the goodwill you can bet the adjusted profit figure ignoring the “one off – non cash” write off would have been the figure being marketed.
I guess it won’t matter now – It will all be lost into the PRG business Combination accounting. Hope they are more transparent then SKE management.
SKE Price at posting:
$1.68 Sentiment: None Disclosure: Held