Pooling of Interests
An accounting method, used in mergers and acquisitions, where the balance sheet items of the two companies are simply added together. Investopedia Says:
The opposite of pooling of interests is the purchase acquisition method. Pooling of interests is the preferable method to use because it doesn't result in the creation of goodwill. This in turn leads to higher reported earnings.
Certain criteria must be met before the pooling of interests method can be used. Related Terms:
Acquisition
Merger
Purchase Acquisition |