17 Consolidated statement of financial position Flashcards
What is W1?
Group structure
What is W2?
Net assets of subsidiary
How is W2 made up?
-Share capital
-Retained earnings
-Other components of equity
-Fair value adjustments
-Post-acquisition depreciation of FVA
PURP adjustment (if S seller)
What is W3?
Goodwill
How is W3 made up?
- Fair value of consideration
- NCI at acquisition
- Subsidiaries net assets at acquisition (W2)
- Impairment
How is non controlling interest at acquisiton measured?
- Fair value
- Its proportionate share of the fair value of subsidiary’s net assets at acquisition
How is negative goodwill treated?
Credited to the P&L and therefore added to retained earnings
What is W4?
Non-controlling interest
How is W4 made up?
- NCI @ acquisition
- NCI @ S % post acquisition reserves.
- NCI x goodwill impairment
What is W5?
Consolidated reserves
How is W5 made up?
- 100% of P reserves
- P% of S post acquisition
- Goodwill impairment
- Gain on bargin purchase
- PURP adjustment (if P was seller)
What are the two ways to deal with goodwill impairment in retained earnings?
- Deduct P% if NCI was at fair value
2. Deduct in full if the NCI was valued at proportional method
How is cash at acquisition measured?
Cash paid
What is the journal for cash at acquisition?
DR Cost of investment (W3)
CR Cash
How is deferred cash measured?
Present value
