FAC2602
(FORMATS AND
SIMPLE NOTES
TO ASSIST:
GROUPS)
,Basic Notes on Consolidation:
Investor contains control by investing 50% or more in subsidiary
Not required: When you are the parent of another subsidiary, but you are a subsidiary of another company
: When the subsidiary is a partially owned subsidiary - and it has been agreed with the owners not to draft it
: not publicly listed company
: Parent financials not filed with a securities commission/regulatory org. - for purpose of public market issuing
: if there is a Parent of the parent the sub parent does not have to do it
General principles
- Should be a fair reflection of Parent and Subsidiaries Financial affairs as at accountning date
- Eliminate profit or losses as a result of intra-group transactions - that have not been realised outside the group
- Eliminate all intra group balances when determining total assets and liabilities
- Eliminate carrying amount of parent investments in subsidiary
Basic steps to consolidating
- Eliminate common items: Investments in parents records, and owners equity section in subsidiaries
record - as at date investment was made (value)
- Eliminate intra group items: like sales made to subsidiary, or assets sold or loans to subsidiary
- Consolidate the remaining items: Draw up statements
,CASHFLOW FORMAT:
Statement of cash flow for company at year end 20xx
Direct method
R R
Cash flows from operating activities
Cash receipts from customers XXX
Cash paid to suppliers & employees (XX)
Cash generated from operations
Interest received XXX
Interest paid (XX)
Dividends received XXX
Dividends paid (XX)
Tax paid (XXX)
Proceeds from sale of financial assets at fair value through
XXX
profit or loss: held for trading (like listed shares)
Net cash from/used in operating activities XXXX
Cash flows from investing activities
Investment to maintain production capacity (XX)
Replacement of non-current assets XX
Investment to expand production capacity (XX)
Additions to non-current assets XX
Proceeds from sale of Property plant & equipment XXX
Proceeds from sale of investments (such as in equity shares or loans) XXX
Net cash from/used in investing activities (XXX)
Cash flows from financing activites
Proceeds from the issue of shares XX
Proceeds from long term borrowings/debentures XX
Repayment of loans (XXX)
Redemption of redeemable preference shares (XX)
Net cash from/used in finance activities XXX
Net increase in cash & cash equivalents XXX
Cash & cash equivalents at beginning of the year XXX
Cash & cash equivalents at end of the year XXXX
, Indirect method
Cash flows from operating activities
Profit before tax XXX
Adjustments for:
Depreciation XX
Loss on sale of non-current assets XX
Profit on sale of non-current asset (XX)
Investment income (XX)
Interest expense XXX
XXXX
Changes in working capital
Decrease/increase in inventory XXX
Decrease/increase in Trade and other receivables XXX
Decrease/increase in Trade and other payables (XX)
Cash generated from operations XXX
Interest received XXX
Interest paid (XX)
Dividends received XXX
Dividends paid (XX)
Tax paid (XXX)
Proceeds from sale of financial assets at fair value through
XXX
profit or loss: held for trading (like listed shares)
Net cash from/used in operating activities XXXX
Cash flows from investing activities
Investment to maintain production capacity (XX)
Replacement of non-current assets XX
Investment to expand production capacity (XX)
Additions to non-current assets XX
Proceeds from sale of Property plant & equipment XXX
Proceeds from sale of investments (such as in equity shares or loans) XXX
Net cash from/used in investing activities (XXX)
Cash flows from financing activites
Proceeds from the issue of shares XX
Proceeds from long term borrowings/debentures XX
Repayment of loans (XXX)
Redemption of redeemable preference shares (XX)
Net cash from/used in finance activities XXX
Net increase in cash & cash equivalents XXX
Cash & cash equivalents at beginning of the year XXX
Cash & cash equivalents at end of the year XXXX
(FORMATS AND
SIMPLE NOTES
TO ASSIST:
GROUPS)
,Basic Notes on Consolidation:
Investor contains control by investing 50% or more in subsidiary
Not required: When you are the parent of another subsidiary, but you are a subsidiary of another company
: When the subsidiary is a partially owned subsidiary - and it has been agreed with the owners not to draft it
: not publicly listed company
: Parent financials not filed with a securities commission/regulatory org. - for purpose of public market issuing
: if there is a Parent of the parent the sub parent does not have to do it
General principles
- Should be a fair reflection of Parent and Subsidiaries Financial affairs as at accountning date
- Eliminate profit or losses as a result of intra-group transactions - that have not been realised outside the group
- Eliminate all intra group balances when determining total assets and liabilities
- Eliminate carrying amount of parent investments in subsidiary
Basic steps to consolidating
- Eliminate common items: Investments in parents records, and owners equity section in subsidiaries
record - as at date investment was made (value)
- Eliminate intra group items: like sales made to subsidiary, or assets sold or loans to subsidiary
- Consolidate the remaining items: Draw up statements
,CASHFLOW FORMAT:
Statement of cash flow for company at year end 20xx
Direct method
R R
Cash flows from operating activities
Cash receipts from customers XXX
Cash paid to suppliers & employees (XX)
Cash generated from operations
Interest received XXX
Interest paid (XX)
Dividends received XXX
Dividends paid (XX)
Tax paid (XXX)
Proceeds from sale of financial assets at fair value through
XXX
profit or loss: held for trading (like listed shares)
Net cash from/used in operating activities XXXX
Cash flows from investing activities
Investment to maintain production capacity (XX)
Replacement of non-current assets XX
Investment to expand production capacity (XX)
Additions to non-current assets XX
Proceeds from sale of Property plant & equipment XXX
Proceeds from sale of investments (such as in equity shares or loans) XXX
Net cash from/used in investing activities (XXX)
Cash flows from financing activites
Proceeds from the issue of shares XX
Proceeds from long term borrowings/debentures XX
Repayment of loans (XXX)
Redemption of redeemable preference shares (XX)
Net cash from/used in finance activities XXX
Net increase in cash & cash equivalents XXX
Cash & cash equivalents at beginning of the year XXX
Cash & cash equivalents at end of the year XXXX
, Indirect method
Cash flows from operating activities
Profit before tax XXX
Adjustments for:
Depreciation XX
Loss on sale of non-current assets XX
Profit on sale of non-current asset (XX)
Investment income (XX)
Interest expense XXX
XXXX
Changes in working capital
Decrease/increase in inventory XXX
Decrease/increase in Trade and other receivables XXX
Decrease/increase in Trade and other payables (XX)
Cash generated from operations XXX
Interest received XXX
Interest paid (XX)
Dividends received XXX
Dividends paid (XX)
Tax paid (XXX)
Proceeds from sale of financial assets at fair value through
XXX
profit or loss: held for trading (like listed shares)
Net cash from/used in operating activities XXXX
Cash flows from investing activities
Investment to maintain production capacity (XX)
Replacement of non-current assets XX
Investment to expand production capacity (XX)
Additions to non-current assets XX
Proceeds from sale of Property plant & equipment XXX
Proceeds from sale of investments (such as in equity shares or loans) XXX
Net cash from/used in investing activities (XXX)
Cash flows from financing activites
Proceeds from the issue of shares XX
Proceeds from long term borrowings/debentures XX
Repayment of loans (XXX)
Redemption of redeemable preference shares (XX)
Net cash from/used in finance activities XXX
Net increase in cash & cash equivalents XXX
Cash & cash equivalents at beginning of the year XXX
Cash & cash equivalents at end of the year XXXX
