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Hi,
Not sure if I am missing something but can someone explain the double entry for contingent consideration please and also any subsequent changes?Many thanks
Katie
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Contingent consideration is when we acquire business but the actual amount cannot be known 100% as will depend on difference factors (depends on each situation). In goodwill calculation contingent consideration has to be included at the best estimate amount.
Hi,
Thank you for your replies. What would be the credit entries for the contingent and deferred consideration in the SFP?Thank you for your help. I presume therefore that for deferred consideration it’s the present value of the fair value that’s entered into the goodwill calculation and the equivalent value entered as a liability. Then at year end it is unwound and the interest is charged to the p&l?
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