The International Accounting Standards Board (IASB) has begun its post-implementation review of IFRS 3, the business combinations standard which sets out how an entity should account for the acquisition of another entity.

The standard was developed in two stages, starting initially in 2004 and with additional work in 2008. IASB's review will look at the changes introduced in both stages, including changes to the presentation of consolidated financial statements that were made at the same time.

The post implementation review will begin with IASB undertaking targeted outreach to identify areas in which implementation problems or unexpected costs with IFRS 3 were encountered. It will also review academic and other studies about the application of the standard.

The areas identified during this phase will be included in a Request for Information (RFI), which will be published for public comment and which will lead to the second phase of the review. At this point, the IASB will undertake extensive outreach and analyse the public comments received in response to the RFI to learn about experience in applying the standard and the experience of investors and others in using the results it produces.

At the end of the review process, the IASB will publish a feedback statement with the main findings and the steps it plans to take, if any, as a result of the review.

Hans Hoogervorst, IASB chairman said: 'We remain committed to undertaking post-implementation reviews of new standards and major amendments to ensure they are working as intended. We want to make sure that IFRS 3 is being implemented on a consistent basis and to understand any unintended consequences arising from its introduction.'