| Pooling
of Interests |
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An accounting method used in mergers and acquisitions where the balance
sheet items of the two companies are simply added together.
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The
opposite of pooling of interests is the purchase acquisition method.
Pooling of interests is the preferable method to use because it does
not result in goodwill being created. This in turn leads to higher
reported earnings.
Certain criteria must be met before the pooling of interests method
can be used. |
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Dictionary
