Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Exchange difference on Goodwill
- This topic has 2 replies, 2 voices, and was last updated 7 years ago by kylerlu.
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- February 11, 2017 at 7:23 am #371930
Hi Sir Chris!
I was just wondering why the calculation for exchange difference is different between Sept/Dec 2015 and June 2011 examination as shown below… When I use the June 2011 style to Sept/dec 2015, i get a different answer for exchange difference. I tried to fix the format but it just would not show when posted…
Hope to hear from you soon. Thanks.
Sept/ Dec 2015 (Loss on Exchange Difference)
Goodwill
Dinars Ex-rates $
Consideration 368
FV NCI 220
NA at Aquisition (468)
______
120 DOA 8 15
Impairment (120)(20%)= (24) Avg 8.5 2.8
______
96 DOC 9.5 10.1Exchange difference (12.2-10.1)= 2.1
Impairment Loss = 2.8June 2011
Goodwill
Dinars Ex-rates $
Consideration 276
FV NCI 250
NA at aquisition (495)
_______
31Exchange difference on Goodwill
Consideration 276
NA at aquisition (495)(52%)= 257.4
_______
18.6
18.6 @DOA rate 6 = 3.1
18.6 @DOC rate 5 = 3.72
______
Exchange difference gain= .62February 12, 2017 at 8:33 pm #372117Hi,
It is because in the latter exam there is an impairment and the goodwill is calculated differently in each question. One uses fair value, whilst the other uses the proportionate share of net assets method.
Thanks
February 17, 2017 at 3:58 am #372805Thanks Sir Chris! 🙂
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