There are two methods of accounting for amalgamation as follows:

The Pooling of Interest Method: Under this method, the assets, liabilities and reserves of the transferor company are recorded by the transferee company at their existing carrying amounts. However, when the accounting policies followed by the transferor and transferee companies are conflicting, then adjustment is made and a uniform set of accounting policies is adopted following the amalgamation.

The Purchase Method: Under the purchase method, the transferee company accounts for the amalgamation either by incorporating the assets and liabilities at their existing carrying amounts or by allocating the consideration to individual identifiable assets and liabilities of the transferor company on the basis of their fair values at the date of amalgamation.