FAC2602 - Selected Accounting Standards And Simple Group Structures (FAC2602)
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FAC2602 Learning Unit 5 2022.
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Course
FAC2602 - Selected Accounting Standards And Simple Group Structures (FAC2602)
Institution
University Of South Africa
FAC2602 Learning Unit 5 2022. The following represent the abridged financial statements of X Ltd and its subsidiary, Y
Ltd:
STATEMENTS OF FINANCIAL POSITION AS AT 31 DECEMBER 20.9
X Ltd Y Ltd
R R
ASSETS
Property, plant and equipment
Investment in Y Ltd – 30 000 ordinary shares at fair val...
fac2602 selected accounting standards and simple group structures
selected accounting standards and simple group structures
fac2602 learning unit 5 2022
Written for
University of South Africa
FAC2602 - Selected Accounting Standards And Simple Group Structures (FAC2602)
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FAC2602
Learning
Unit 5 2022.
, FAC2602
Open Rubric
, LEARNING OUTCOME
You should be able to consolidate the financial statements of a group of companies if
the interest in the partly owned subsidiary was acquired a few years ago in accordance
with International Financial Reporting Standards.
OVERVIEW
5.1 INTRODUCTION ................................................................................................ 2
5.2 CONSOLIDATION OF A PARTLY OWNED SUBSIDIARY AFTER THE DATE
OF ACQUISITION .............................................................................................. 2
5.3 INTRAGROUP TRANSACTIONS ....................................................................... 8
5.4 EXERCISES ....................................................................................................... 8
SELF-ASSESSMENT .................................................................................................... 19
KEY CONCEPTS
• Treatment of post-acquisition profits
• Allocation to non-controlling interests
• Intragroup transactions
• Pro forma consolidation entries
• Treatment of goodwill after acquisition
ASSESSMENT CRITERIA
After studying this learning unit, you should be able to:
• draft the consolidated annual financial statements of a parent and
its partly owned subsidiary after the date of acquisition in
accordance with IFRS
• eliminate intragroup items and common items
• do the pro forma consolidation journal entries
• calculate, measure and disclose the goodwill that arises at
acquisition
1
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