Product Description: "This text offers a current, condensed treatment of advanced accounting topics and a unique emphasis on accounting research. Taking a macro approach and then relating it back to an application, the text attempts to explain the "why" behind accounting, in addition to the procedural methods. The authors are active teachers and have been successfully using this material in the classroom for many years.
Advanced Accounting - FAS 141 Errata in book Be aware that the treatment of negative goodwill in this book is not correct. The book will have you record an extraordinary gain. FAS 141 (para 36,44, and 47) states that the fair values of non-current assets (typically fixed assets and any identifable intangible assets)must be written down (pro-rata) to the extent the negative goodwill is exhausted and the fair value of net assets acquired (or taken control of in a stock deal) equal the purchase price. If any negative goodwill exists after the assets noted above are written down, THEN an extraordinary gain should be recorded.
This all changes if contingent consideration ("CC") exists. If indeed CC exists, you must accrue the LESSER of the maximum amount of the contingent consideration or the negative goodwill as a liability. I did not see this addressed in the book at all, and it is VERY common in practice.
I also did not read where identifiable intangible assets should be recorded before Goodwill is recorded. Companies must now identify any unrecorded assets belonging to the acquiree and record them on their opening balance sheet at fair value and assigned a useful life. Examples of the assets include, customer lists, non-compete agreements, formulas, copyrights, patents, etc.
An Excellent Text I teach Advanced Accounting, and my review reflects this perspective. As I write this, I have used this textbook for a semester and a half. There are some topics covered in competing texts that are not covered in this one, and I am disappointed that it costs almost as much as competing texts. However, the length of this text is appropriate for a one semester course. The topics covered are 3 chapters of consolidations, 1 chapter each on intercompany transactions (covering inventory, plant assets, and debt), foreign currency transactions, foreign currency financial statements, not-for-profit accounting, and two chapters each of partnerships, local government accounting, and an additional chapter on colleges and universities. There are also supplements on accessing databases and special purpose entities.
For the material it does cover, it is very concise and condensed compared to the other texts on the market. Some of the more arcane details in other textbooks are left out. Its conciseness helps the book to be clear. The text is very well written and understandable. To the extent possible, each chapter takes a single example and illustrates various methods going from the simple to complex. Each example adds some complexity but keeps the prior information so that it is clear how the additional transaction complexity affects the appropriate accounting treatment. There are errors in the text, but they are almost all minor and they authors make available a file with a listing of these errors (available on the text's website). It is easy to go through the list and identify the important errors and make corrections in the book. Despite this being a first edition text, there are significantly fewer errors than in the other texts I have used.
One of the more important aspects of any textbook are the homework assignments and solutions manual. The homework assignments do a good job of covering the material and focusing on the key issues instead of throwing in details that have little to do with the issue at hand. There are normally enough problems so that each topic is repeated, but it would be nice to have a few more exercises or problems in a couple of the chapters. It is important to have exercises that repeat the same material because it allows students to practice on fresh problems. The solutions manual has few errors, and in my experience, when the errors are pointed out to the author, the author quickly revises the solutions and posts them to the website. The test bank is very extensive. Only instructors have access the solutions and test bank, but instructors can pass them on to their students (I make the Solutions available to my students).
On June 30, 2005 the FASB issued an exposure draft on consolidations, but they have not yet issued a new standard for consolidations (as of 10-13-06). One of the unique aspects of this text is that it anticipates the next FASB pronouncement on the subject of consolidations. The authors use FASB materials to create a text that should be very close to the next FASB pronouncement. This is an advantage if the FASB passes a standard that is close the exposure draft in the reasonably near future. Obviously there is a risk that the standard will be different than anticipated or that the standard will be delayed indefinitely. You may find this risk unacceptable, but I believe that this risk is balanced by the risk that the current standards will be obsolete by the time students graduate. The proposed standards are sufficiently similar to the current standards that either risk is modest.
Advanced Accounting textbooks cover a number of unrelated topics including consolidation, partnerships, government and not-for-profit accounting. Because the different chapter are written by different authors, some Advanced Accounting textbooks have uneven quality between the chapters. Although the chapters in this book are written by different authors, the text is of consistently high quality with an emphasis on conciseness and clarity.
You can pay a few dollars more for the version that includes the FARS CD. Although I like the FARS CD, it is not integrated into the text. There are four pages that explain how to use it, but there are no assignments related to it.
This is an excellent text, and I highly recommend it, especially if you are looking to learn the topics covered or you are an instructor choosing a text for a one semester (or quarter) course. However, it is less appropriate as a reference because of the lack of depth and breadth, especially since the cost is similar to (or only slightly less than) competing textbooks.
A good text, but plenty of errata. This is a fairly good text for a first edition. It is littered with errata, which are mainly formatting but do also include math and spelling / grammar.
If possible, make sure your instuctor has a list of errata for you to correct the text of at least the errors that will cause difficulty in grasping the subject matter.
Anything Goes Trivia
Megaton Man
Tailipoe
Trevor
