20 Group disposals

Question 1

How is a disposal of a subsidiary recorded in the parent financial statement?

Answer 1

Sales proceeds less carrying amount of investment.

Question 2

How is a disposal of a group disposal recorded in the parent financial statement?

Answer 2

Show separately as exceptional item on face of SPL below profit from operations

Question 3

What is the impact on the consolidated financial statements in the profit and loss?

Answer 3

Subsidiary results consolidated up to date of disposal, profit and loss on disposal.

Question 4

What is the impact on the consolidated financial statements in the financial position?

Answer 4

Subsidiary not consolidated and profit and loss in disposal recorded in retained earnings

Question 5

How do you calculate net assets at disposal date?

Answer 5

Net assets b/f
Profit or loss to date of disposal
Less dividends paid prio