17 Consolidated statement of financial position Flashcards Preview

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Flashcards in 17 Consolidated statement of financial position Deck (23)
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1
Q

What is W1?

A

Group structure

2
Q

What is W2?

A

Net assets of subsidiary

3
Q

How is W2 made up?

A

-Share capital
-Retained earnings
-Other components of equity
-Fair value adjustments
-Post-acquisition depreciation of FVA
PURP adjustment (if S seller)

4
Q

What is W3?

A

Goodwill

5
Q

How is W3 made up?

A
  • Fair value of consideration
  • NCI at acquisition
  • Subsidiaries net assets at acquisition (W2)
  • Impairment
6
Q

How is non controlling interest at acquisiton measured?

A
  • Fair value

- Its proportionate share of the fair value of subsidiary’s net assets at acquisition

7
Q

How is negative goodwill treated?

A

Credited to the P&L and therefore added to retained earnings

8
Q

What is W4?

A

Non-controlling interest

9
Q

How is W4 made up?

A
  • NCI @ acquisition
  • NCI @ S % post acquisition reserves.
  • NCI x goodwill impairment
10
Q

What is W5?

A

Consolidated reserves

11
Q

How is W5 made up?

A
  • 100% of P reserves
  • P% of S post acquisition
  • Goodwill impairment
  • Gain on bargin purchase
  • PURP adjustment (if P was seller)
12
Q

What are the two ways to deal with goodwill impairment in retained earnings?

A
  1. Deduct P% if NCI was at fair value

2. Deduct in full if the NCI was valued at proportional method

13
Q

How is cash at acquisition measured?

A

Cash paid

14
Q

What is the journal for cash at acquisition?

A

DR Cost of investment (W3)

CR Cash

15
Q

How is deferred cash measured?

A

Present value

16
Q

What is the journal for deferred cash?

A

DR Cost of investment (W3)

CR Liability

17
Q

How are shares at acquisition measured?

A

Fair value at acquisition

18
Q

What is the journal for shares of acquisition?

A

DR Cost of investment (W3)
CR Share Capital
CR Share Premium

19
Q

How are deferred shares measured?

A

Fair value at acquisition

20
Q

What is the journal for deferred shares?

A

DR Cost of investment (W3)

CR Other components of equity

21
Q

How are contingent considerations measured?

A

Fair value

22
Q

What is the journal for contingent consideration?

A

DR Cost of investment (W3)

CR liability/Equity

23
Q

What are some adjustments that could be made to W2?

A

PPE, Inventory, Intangible assets not recognised, contingent liabilities