1. Profile photo of rooman says

    @MikeLittle In this above example 4…. Why the INCI share of the investment in Liene is not deducted from Liene’s NCI calculation (but from Kristine’s NCI )as you did in example 3 ? Both give the same results, but i do not understand the reason.which treatement should i follow now

  2. avatar says

    For the answer to Example 4 here, how come we didn’t put the values of the NCI’s into Working 2.

    For example we knew that the value for Liene was proportional, and we new that at the date of acquisition the value of the shares were $1.70 so could have calculated the NCI in Kristina from that?

    • Profile photo of MikeLittle says

      @curiousmeerkat, Because there’s no need to – the nci in Liene is proportional – so the only goodwill is attributable to either Kristina or to Anda.

      The share value in Kristina may have nothing to do with the directors’ valuation of the nci – BE CAREFUL!!! The nci value is not always going to be exactly the number of nci shares multiplied by the market value of those shares

  3. avatar says

    Mr Mike Little,

    for example 5, i do understand the proportion of Liene’s dividend to Kristina (of $40,000) and to Anda (of $8,000)..but then again, what is given to Kristina by Liene (ie dividend), it should have percentage (of 70%) to the Anda as well..that means Anda will have another div receivable from L through K at $2,800 (70% of $40k)..i need clarification on this..tq

    • Profile photo of MikeLittle says

      @mizanm, No, Anda receives her 8% of Liene’s dividend from her direct investment in the sub-subsidiary. Kristina receives her share of the Liene dividend too.

      Ok, that deals fully with the Liene dividend

      Now declare and account for the Kristina dividend payable.

  4. avatar says

    2 questions please:
    1. Why the INCI share of the investment in Liene is not deducted from Liene’s NCI calculation as in example 3 but from Kristine’s NCI calculation? Both give the same results, but i do not understand the reason.
    2. When calculating the goodwill in Liene should we split it in 2 parts (A in L and K in L) or could we just make a combined calculation? It also gives the same results.

    • avatar says


      1. As for example 3, the NCI share of investment in V should be deducted in working 4A NCI (20% in D) it will look the same like in example 4 where the NCI share of investment in L was deducted in (30% in K) other words it will be deducted while doing NCI for Subsidiary…not sub-subsidiary..still the TOTAL NCI will be the same if you make it the other way around

      2. Yes, we can. In BPP, the goodwill is presented in a combined calculation. So if that’s will be (A in K) and (A and K in L). and yeah, the TOTAL GW at the end will be the same…either you combine..or as Mr Little’s..

      I hope that explains..and pls correct me if i’m wrong :)

    • avatar says

      @hamda, i think it is because NCI has no goodwill for Liene as you can see in working 2. So there is nothing to impair unlike Kristina where they gave an NCI goodwill of 15,000 in the question. That’s how i understand it

      • avatar says

        @sodiqlawal, its because the goodwill is valued on a proportional basis therefore the cost of the subsid and the NCI FV at DOA will always be equal resulting in no goodwill. I just remember it that if they say goodwill valued on proportional basis then there will be no NCI goodwill.
        hope this makes sense :)

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