Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Contigent,deferred consideration and share exchange.
- This topic has 1 reply, 2 voices, and was last updated 7 years ago by MikeLittle.
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- June 28, 2016 at 11:37 pm #324350
Hi Mike,
I have watched most of the lectures of the Group Accounts.
Your lectures are very very informative, clear and I have started to follow the same format as shown in the videos. Thanks so much!!!Contingent consideration is when the cost of investment is paid partly at the DOA and partly is paid if subsidiary made xxxxx amount of profit by a future date.
We still include contingent consideration of both the payment at the year end. Is that correct??
How do we treat contingent consideration in form of equity, debt instrument or cash.Please can you also explain what is acquisition date fair value of contingent consideration.
I am really struggling to understand this topic.
Thanks.June 29, 2016 at 6:09 am #324364In any exam question involving contingent consideration the examiner will always provide you with sufficient information to be able to arrive at a value
From memory he invariably says “Ignore the time value of money” when contingent consideration is involved
“How do we treat contingent consideration in form of equity, debt instrument or cash” – You will be given values for each element. As for double entry ….
Dr Cost of Investment
Cr Contingent ConsiderationHope that helps
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