Accounting for M&A: Uses and Abuses of Accounting in Monitoring and Promoting Merger

The book explores the manipulation of annual accounts by acquirers ahead of share for share bids, biased forecasts of post-merger earnings by bidders, and devices to flatter earnings when recording the deal. It also examines the challenges for standard-setters in regulating information during and after M&A and for account-users wishing to learn from financial statements how a deal has affected performance. It is targeted at accounting specialists, business executives, lawyers, bankers, and investors involved in M&A, as well as graduate students interested in researching or learning about the role of accounting in M&A.

Format: Paperback / softback
Length: 306 pages
Publication date: 13 December 2021
Publisher: Taylor & Francis Ltd

The remarkable surge in mergers and acquisitions (M&A) spending has surpassed the capital expenditure dedicated to expanding and sustaining physical assets. However, a concerning report from McKinsey, the renowned management consultancy, indicates that approximately 70% of mergers fail. This raises questions about the basis of M&A decisions, as businesses are utilizing substantial shareholder funds for an activity with a high failure rate.

This book delves into statistical analyses, case studies, and expert opinions on corporate accounting before, during, and after M&A. It uncovers instances of acquirers manipulating annual accounts, biased predictions of post-merger earnings by bidders, and strategies to inflate earnings during the deal recording. It also explores the challenges faced by standard-setters in regulating information flows during and after M&A, as well as the importance of financial statements in providing insights into the impact of deals on performance.

Drawing from a diverse range of international examples, this accessible book is designed for a broad audience, including accounting specialists, financial press readers, those intrigued by the M&A market, and individuals concerned with making more informed M&A decisions. It holds particular relevance for business executives, lawyers, bankers, and investors involved in M&A, as well as graduate students interested in researching or learning about the role of accounting in M&A.

Weight: 488g
Dimension: 156 x 233 x 25 (mm)
ISBN-13: 9780367492373