The formation of a new entity to acquire the shares of two (or more) other entities is an example of a business combination in accordance with AASB 3/IFRS 3 Business Combinations.

Question

Quizplus · Accepted Answer

This statement is true. A business combination is defined by AASB 3/IFRS 3 as "a transaction or other event in which an acquirer obtains control of one or more businesses." This can occur through the acquisition of shares of other entities, the acquisition of assets, the assumption of liabilities, or other means.

The Formation of a New Entity to Acquire the Shares