Full goodwill method vs. partial goodwill method: A comparison of financial consolidation according to US GAAP, IFRS, and German GAAP

This document illustrates the different accounting methods for a business combination structured as an asset deal versus a share deal and how they affect the acquiring party´s financial statements. However, the way these two forms are represented in the consolidated financial statements is identical, with the share deal being represented as an asset deal. 

In the case of a business combination with a share of less than 100%, there are two different capital consolidation methods: the full goodwill method and the partial goodwill method.

Learn how these methods impact a corporation's various key figures, and what benefits and drawbacks they present. This is particularly of interest to IFRS users, because IFRS allows a choice between both methods. However, financial analysts should also be familiar with these effects when comparing consolidated financial statements prepared in accordance with US GAAP, IFRS, and HGB.