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FEI and CCR Release Insights to Help Navigate Internal Controls Efforts Around Business Combinations

Morristown, N.J. – Financial Executives International (FEI), the association of choice for CFOs, Controllers, and other senior-level finance executives, and the Committee on Corporate Reporting (CCR), a technical committee of FEI, today released a new guide in the ICFR: Insights, Issues, and Practices series that addresses internal control considerations for business combinationsThe guide is intended to provide useful, relevant information that will help companies focus internal control efforts related to business combinations on areas that present risks of material misstatement.  

CCR has observed that, due to the complexity surrounding business combinations, many preparers expend significant effort in designing controls and developing documentation to operate an effective system of internal control at the time of a business combination and post-acquisition. 

The objective of this preparer-led effort is to provide a high-level overview on how to design and operate appropriate controls related to business combinations. Specifically, the guide addresses internal control considerations related to the valuation of assets acquired and liabilities assumed, consolidations, manual journal entries, measurement period adjustments, accounting policy alignment, control environment integration, and disclosures. The information within the guide is presented via insights, best practices, and general recommendations.

“Maintaining and implementing effective internal controls is one of management’s most important responsibilities. Business combinations is a particularly challenging area for internal controls where management must pay close attention. This ICFR guide represents the collaborative efforts of leading preparers, with input from their auditors. We believe this will help refresh the dialogue between management and its auditors, leading to process improvements, better internal controls, and efficiencies,” said Prat Bhatt, CCR Chairman, and Senior Vice President, Chief Accounting Officer and Corporate Controller at Cisco Systems.

ICFR: Insights, Issues, and Practices: A guide to designing and operating an effective system of internal control over business combinations can be downloaded from the FEI website at this link.

About FEI
Financial Executives International (FEI) is the leading advocate for the views of corporate financial management. Its more than 10,000 members hold policy-making positions as chief financial officers, chief accounting officers, controllers and treasurers at companies from every major industry. FEI enhances member professional development through peer networking, career management services, conferences, research and publications. Members participate in the activities of more than 65 Chapters in the U.S.. FEI is located in Morristown, NJ. Visit for more information.

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