Beruflich Dokumente
Kultur Dokumente
1 Group structure
J
1/1/x4 1/1/x1
Acquired 800,000 shares Acquired 60%
Pre-acq: RM500,000 Pre-acq: RM300,000
% control
= 800 / 1000 B H
= 80%
1/1/x8
RM200,000 goodwill w/o
1/10/x8
Sold all shares in B
Proceeds to be received in x9
Not recorded in accounts
Situation:
Subsidiary up to 1/10/x8
Hence, for SOCI, need to consolidate as subsidiary up to 30/9/x8
For SOFP, as at 31/12/x8, B is not a subsidiary => no consolidation
2 Goodwill b/f
J in B J in H
RM000 RM000 RM000 RM000
Consideration transferred 1,500 900
NCI (1200x20%)(1300x 405) 300 520
FV of net assets acquired
Share capital 1,000 1,000
Pre-acq 500 300
1,500 (1,500) 1,300 (1,300)
However, students must note that in the case of 'J in B', this goodwill balance of RM100,000
should no longer exist as at 31/12/x8 in the SOFP since the investment was sold on 1/10/x8
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3 Gain / (loss) on disposal of B by J:
RM000 RM000 Alternative method
Disposal proceeds 3,000 Disposal proceeds 3,000
FV of net assets at date of disposal Less: Cost of investment in Butter (1,500)
Share capital 1,000 Gain at Parent's books 1,500
Retained earnings b/f 1,500
Profits up to 30/9/x8 1000 x 9/12 750 Less : realiasation of post acq. Profit
3,250 {(1500+1,000 x 9/12)-500)} x 80% (1,400)
x 80% (2,600) Goodwill written off 200
Less: goodwill remaining (100) W2
Gain / (loss) on disposal 300 To be recognised in SOCI 300
Students to note that in the case of gain / (loss) at company level, it would be computed as follows: Dr:Sales Proceeds 3,000
RM000 Dr: GRE-goodwill w/off 200
Disposal proceeds 3,000
Cost of investment (1,500) Cr: Cost of investment in Butter 1,500
Gain / (loss) on investment 1,500 Cr: GRE-realisation of profit 1,400
Cr; GRE- gain on disposal 300
4 Non-controlling interest
RM000
Net assets in H as per question 4,600
NCI - % 40%
NCI - nominal 1,840
Alternative presentation:
RM000 RM000
Retained earnings b/f
J 2,500
B - post acq (1500 - 500) x 80% 800
Goodwill impaired (200)
H - post acq (2300 - 300) x 60% 1,200
4,300
Group profit for the year - from SOCI 3,920
Less: dividends by parent (500)
7,720
Jam Group
Consolidated Statement of Comprehensive Income for the year ended 31/12/x8
RM000 RM000
Sales 5000 + (2000 x 9/12) + 4000 10,500
Cost of sales / expenses 2000 + (500 x 9/12) + 1500 (3,875)
6,625
Gain on disposal of investment in B W3 300
Profit before tax 6,925
Taxation 1000 + (500 x 9/12) + 800 (2,175)
Profit after tax 4,750
Profit attributable to
Parent 3,920
NCI - B 1000 x 9/12 x 20% 150
- H 1700 x 40% 680 830
4,750
Jam Group
Consolidated Statement of Financial Position as at 31/12/x8
RM000 RM000
3 413224641.xlsx
Goodwill W2 120
Receivables on disposal of B 3,000
Sundry assets 5140 + 4800 9,940
13,060
4 413224641.xlsx
Tutorial 7-Q2
1 Group structure
J
1/1/x4 1/1/x1
Acquired 800,000 shares Acquired 60%
Pre-acq: RM500,000 Pre-acq: RM300,000
% control
= 800 / 1000 B H
= 80%
1/1/x8
RM200,000 goodwill w/o
1/10/x8
Sold 200,000 shares in B for RM800,000
Remaining shares held = 600,000 shares
% control now becomes = 600 / 1000 = 60%
Proceeds to be received in x9
Not recorded in accounts
Situation:
This is a situation of transaction that reduces shareholdings but still control is retained
No effect on goodwill.
2 Goodwill b/f
J in B J in H
RM000 RM000 RM000 RM000
Consideration transferred 1,500 900
NCI (1200x20%)(1300x 405) 300 520
FV of net assets acquired
Share capital 1,000 1,000
Pre-acq 500 300
1,500 (1,500) 1,300 (1,300)
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3 Gain / (loss) on disposal of B by J:
(but only for the 200,000 shares disposed)
RM000 RM000
Disposal proceeds 800
FV of net assets at date of disposal
Share capital 1,000
Retained earnings b/f 1,500
Profits up to 30/9/x8 1000 x 9/12 750
3,250
x 20% (650)
Gain / (loss) on disposal 150 To be recognised in SOCI under OCI
Students to note that in the case of gain / (loss) at company level, it would be computed as follows:
RM000
Disposal proceeds 800
Cost of investment 1500 x 20 / 80 (375)
Gain / (loss) on investment 425
4 Non-controlling interest
B H Total
RM000 RM000 RM000
Net assets as per question 3,500 4,600
NCI - % 40% 40%
NCI - nominal 1,400 1,840 3,240
J B B H
RM000 RM000 RM000 RM000
Retained profits b/f 2,500 1,500 2,300
Profit for the year (or 9 mths for B) 2,000 750 250 1,700
Dividends income 240
Dividends paid (400)
Pre-acq (500) (300)
1,750 250 3,300
Share of post-acq
B: 1750 x 80% 1,400
B: 250 x 60% 150
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H: 3300 x 60% 1,980
Goodwill impaired (200)
Increase in NCI 150
Dividends paid (500)
7,720
Alternative presentation:
RM000 RM000
Retained earnings b/f
J 2,500
B - post acq (1500 - 500) x 80% 800
Goodwill impaired (200)
H - post acq (2300 - 300) x 60% 1,200
4,300
Group profit for the year - from SOCI 3,920
Less: dividends by parent (500)
7,720
Jam Group
Consolidated Statement of Comprehensive Income for the year ended 31/12/x8
RM000 RM000
Sales 5000 + 2000 + 4000 11,000
Cost of sales / expenses 2000 + 500 + 1500 (4,000)
Profit before tax 7,000
Taxation 1000 + 500 + 800 (2,300)
Profit after tax 4,700
Increase in NCI 150
4,850
Jam Group
Consolidated Statement of Financial Position as at 31/12/x8
RM000 RM000
Goodwill W2 220
Receivables on disposal of B 800
Sundry assets 5140 + 3700 + 4800 13,640
14,660
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Tutorial 7-Q3
1 Group structure
J
1/1/x4 1/1/x1
Acquired 800,000 shares Acquired 60%
Pre-acq: RM500,000 Pre-acq: RM300,000
% control
= 800 / 1000 B H
= 80%
1/1/x8
RM200,000 goodwill w/o
1/10/x8
Sold 500,000 shares in B for RM2,500,000
Remaining shares held = 300,000 shares FV of remaining shareholdings = RM4.5 x 300,000
% control now becomes = 300 / 1000 = 30% = 1,350,000
Proceeds to be received in x9
Not recorded in accounts
Situation:
This is a situation of transaction that reduces shareholdings; B becomes associate company
Goodwill eliminated
2 Goodwill b/f
J in B J in H
RM000 RM000 RM000 RM000
Consideration transferred 1,500 900
NCI (1200x20%)(1300x 405) 300 520
FV of net assets acquired
Share capital 1,000 1,000
Pre-acq 500 300
1,500 (1,500) 1,300 (1,300)
However, students must note that in the case of 'J in B', this goodwill balance of RM100,000
should no longer exist as at 31/12/x8 in the SOFP since B becomes associate company after 1/10/x8
03/25/2019 413224641.xlsx
RM000 RM000
Disposal proceeds 2,500
FV of remaining shareholdings 1,350 W1
FV of net assets at date of disposal
Share capital 1,000
Retained earnings b/f 1,500
Profits up to 30/9/x8 1000 x 9/12 750
3,250
x 80% (2,600)
Less: goodwill remaining (100) W2
Gain / (loss) on disposal 1,150 To be recognised in SOCI
Students to note that in the case of gain / (loss) at company level, it would be computed as follows:
RM000
Disposal proceeds 2,500
Carrying value of investment 1500 x 500/800 (938)
1,563
4 Non-controlling interest
RM000
Net assets in H as per question 4,600
NCI - % 40%
NCI - nominal 1,840
J B B H
RM000 RM000 RM000 RM000
Retained profits b/f 2,500 1,500 2,300
Profit for the year (or 9 mths for B) 2,000 750 250 1,700
Dividends income 240
Dividends paid (400)
Pre-acq (500) (300)
1,750 250 3,300
Share of post-acq
B: 1750 x 80% 1,400
B: 250 x 30% 75
H: 3300 x 60% 1,980
Goodwill impaired (200)
Gain on disposal of subsidiary W3 1,150
Dividends paid (500)
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8,645
Alternative presentation:
RM000 RM000
Retained earnings b/f
J 2,500
B - post acq (1500 - 500) x 80% 800
Goodwill impaired (200)
H - post acq (2300 - 300) x 60% 1,200
4,300
Group profit for the year - from SOCI 4,845
Less: dividends by parent (500)
8,645
6 Investment in associate
FV of shareholdings as at 1/10/x8 W1, W3 1,350
Share of post acq SOCI, W5 75
Carrying value @ 31/12/x8 1,425
Jam Group
Consolidated Statement of Comprehensive Income for the year ended 31/12/x8
RM000 RM000
Sales 5000 + (2000 x 9/12) + 4000 10,500
Cost of sales / expenses 2000 + (500 x 9/12) + 1500 (3,875)
6,625
Gain on disposal of investment in B W3 1,150
Share of profit of associate 1000 x 3/12 x 30% 75
Profit before tax 7,850
Taxation 1000 + (500 x 9/12) + 800 (2,175)
Profit after tax 5,675
Jam Group
Consolidated Statement of Financial Position as at 31/12/x8
03/25/2019 413224641.xlsx
RM000 RM000
Goodwill W2 120
Receivables on disposal of B 2,500
Investment in associate 1,425
Sundry assets 5140 + 4800 9,940
13,985
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