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 va...
, 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
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller STUDYLAB2023. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R57,62. You're not tied to anything after your purchase.
