Business Combinations Under Common Control


The IASB published its Discussion Paper Business Combinations under Common Control in November 2020.  The IASB’s comment deadline is 1 September 2021.


The Discussion Paper explores requirements for business combinations under common control (BCUCC), which are not currently addressed by IFRS standards. 

BCUCC occur when a business is transferred from one company to another company within the same group.  In the example below Company C is transferred from one company to another, within the same company group (Company P group).  Note that from a group point of view nothing has changed – the group still contains the same assets and liabilities before and after.  However, they have been reorganised.


Today, in the absence of guidance, some receiving companies (B) will choose to measure the assets and liabilities of Company C received in the combination at book value. Other receiving companies would choose to follow the IFRS 3 acquisition method and take on Company C at fair value.  This creates inconsistency.

Key IASB Proposals

In overview the IASB’s preliminary views are that:

  1. When the receiving company is listed or has non-controlling shareholders it should use the IFRS 3 acquisition method of accounting (with some limited exceptions).
  2. When the receiving company is not listed, and does not have non-controlling shareholders, it should use the book value method of accounting, further details of which are specified in the Discussion Paper. 

Planned Outreach

Our preliminary outreach suggests that business combinations under common control are most frequently administrative exercises to streamline the group structure, reflect other internal restructurings or performed for tax purposes and that accounting for the majority of these transactions is under local GAAP.

The planned outreach on this project will include a pre-recorded educational webinar, a stakeholder survey, and public consultation on our draft comment letter.

If you would like to contribute to outreach work on this project, please email

Draft Comment Letter

The UKEB draft comment letter on Business Combinations Under Common Control is now available for stakeholder comment.  Please find a copy of the letter here and Invitation to Comment below.   Comments are due by 30 June 2021.


Please note the survey has now closed.  Thank you for your participation.

The UK Endorsement Board secretariat has launched a survey on IASB Discussion Paper DP/2020/2 Business Combinations Under Common Control (BCUCC).

The discussion paper proposes a multipath approach to accounting for BCUCC in the Receiving Company of the transaction.  Key proposals include:

  • If the Receiving Company is listed or has non controlling shareholders the IFRS 3 acquisition accounting method is used (with some limited exceptions)
  • In all other circumstances the book value method will be used.
  • The Discussion Paper specifies which book value should be used if using the book value method.
  • The Discussion Paper specifies how any difference between consideration and the value of the assets and liabilities acquired should be accounted for.
  • Disclosure requirements are introduced for BCUCC.

We are seeking your views on the proposals in the Discussion Paper, as well as information about your past experiences with BCUCC.  The survey is multiple choice and should take around 15 minutes to complete.  Your responses providing answers to individual questions or to the full survey will be valuable to us.  The survey is open until COB 6 May 2021.

If you would like more information on the Discussion Paper requirements, our recent educational video made in conjunction with IASB can be seen here.

Business Combinations Under Common Control Discussion Paper video with IASB and UKEB

The UK Endorsement Board secretariat launched a video guide on IASB DP/2020/2 Business Combinations Under Common Control.

Hosted by Louise Freeman (UKEB secretariat) and Yulia Feygina (IASB technical staff) the video provides an overview of the proposals in the discussion paper, gives an insight into the IASB thinking behind these proposals and reflects on some of the stakeholder feedback received to date.

The presentation can be found below and the video can be seen here.

Document type
02 September 2021
02 September 2021
07 April 2021