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CONCLUSION

With the abolition of pooling-of-interests accounting, companies will un­doubtedly turn to new methods of disguising the true impact of their merg­ers and acquisitions.

Navigant Consulting’s aggressiveness in determining the transaction date is but one illustration of financial executives’ boundless ingenuity in playing with numbers. Regulators may tighten up rules that can be abused, such as the standards for materiality, but corporate managers usually manage to stay one step ahead. Analysts who hope to understand the thought process of the field’s most notorious innovators would do well to study the classic gambits employed in the M&A area.


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Source: Fridson M., Alvarez F.. Financial Statement Analysis. John Wiley & Sons, Inc.,2002. — 413 p. 2002
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