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M&A

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Analyze the effects of the following on M&A activities:
1) Accounting (revenue enhancement, cost reduction, risk management
2) Taxes (shields, synergies, WACC)
3) Legal (corporate organization and ownership, litigation risk, law compliance)
4) Select at least two effects from each category and explain it's relevance in pursuing an M&A strategy.

Based on research of the subject matter, prepare a concise yet detailed outline including introduction, body (corresponding to the topics below), conclusion and references (last section of outline). The outline must include properly formatted APA citations and references. Length should be sufficient to cover the subject matter.

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Analyze the effects of the following on M&A activities

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Introduction:

An M&A has major impact on the operations of both the acquiring as well as acquired entity from various perspectives, be it operational areas, legal practices or even culture. As two distinct firms merge together or form a single entity, it results in numerous implications for the independent operations of two firms that are now merged together to operate as a single entity in tandem with each other. This paper highlights impact of such M&A in some of the important areas.

Let us start with the accounting area. Accounting is one of the most heavily affected area due to merger or acquisition. The prima facie impact in terms of accounting is on the revenue enhancement front. When two firms combine, they combine their total sales, number of customers, reach and distribution network and capabilities to serve a larger unified market. All these factors result in significant growth in sales and revenue. The topline of the merged entity is significantly enhanced due to combining of resources of two distinct entities which is much more powerful than before.

Another major area that gets affected is the operating ...

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