Conslidation

Question 1

format for equity adjustment in step acquisition(further investment in subsidiary)

Answer 1

Decrease in NCI:
• In Value of NCI at acquisition [Value at acquisition x decrease%/old NCI%] X
• In Other reserves x decrease%] X
• In RE [(iv) (1) above x decrease%] X X
Consideration paid for 2nd investment (X)

Adjustment in equity [+/-] X

Question 2

while the company has made the further investment in the associates and it became the sub now 1st investment will be removed from the investments in the face of the SOFP this investment will include the FV or @ amount at which it made the 1st investment at cost

Answer 2

Investment at cost will be removed because FV gain is already counted in Goodwill working
Also company had recorded it at cost and has not updated it at FV so cost will be removed

Question 3

format/formula of FV gain/loss in 1st Investment

Answer 3

FV of the 1st investment less(cost of 1st investment + other reserves(while being associate) + Retained earnings (while being associate)= gain

Question 4

Formate of Gain/loss on disposal

Answer 4

Consideration received XXX
Less: Share of net assets derecognized:
Carrying amount of net assets at the date of disposal X
Consolidation adjustments in assets & liabilities X
Carrying amount of goodwill X
XX
Less: NCI derecognized:
Value at acquisition X
Other reserves [Post-acq. till disposal x NCI%] X
RE [Post-acq. till disposal x NCI%] X
(XX)
(XXX)
Gain / (loss) on disposal X

Question 5

Intangible assets represents amount paid to a consultant for rendering professional services for the acquisition of 45% of the equity in RGL what is the treatment

Answer 5

it should be expensed out in RE column and should not be included in the acquisition cost