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1= As we know we put an adjustment for NCI in Subsidiary for Share of Consideration paid for acquistion of SUB-SUBSIDIARY.
When there is a decrease/increase in NCI due to changes in structure.
I calulate INCREASE/Decrease by this
(NCI at transaction date (of disposal/further interest) * % Change in NCI holdingMy Question is if Subsidiary disposes interest in Sub-Subsidiary ; that NCI ADJUSTMENT is not proportionated?
2=Also ,can you guide which standard to refer to for additional study for complex group structure (is there any guidance ?)
Ashanti June 2010
1.Ashanti Acquired Bochem ,Bochem Acquired Ceram. ( Bochem’s NCI will be adjusted for Consideration paid for Ceram)
Ashanti Disposes 10% equity interest in Bochem to NCI .
How would Increase in NCI would be accounted for.
(Should the BochemNCI at transaction date would be completely proportioned?without taking account of NCI Adjustment —- as normally i take carrying amount of NCI at transaction date and proportionate it according to the change in NCI)Meaow – am I not correct in saying that not only does the examiner’s answer in workings W2 and W3 answer your question but, in addition, the examiner has kindly pointed out that the method he has adopted could equally well be treated differently “However, goodwill could be calculated from the entity’s perspective ($47 million) which would give a signi?cantly different goodwill and gain/loss on disposal ?gure.”
1- For Disposal of Ceram, Examiner provided “NCI of Ceram attributable to
Bochem” (not Ashanti) .and Also included this in gain/loss calculation^ , is this the reason that portion of gain/loss is attributable to NCI of bochem?
2-How is the 30% calculated ? [Bochem had 80% holding,disposed of 50% ,that lefts with 40% holding on associate for Bochem ]
3-Increase in NCI :
Amount recognised as non-controlling interest (Net assets per question at year
end $210m + Fair value of PPE at acquisition $10m – depreciation of fair value
adjustment $4m + goodwill (44 – 8·8)) x 10%Does that mean NCI-adjustment for Ceram ,should not be apportioned?
1 “, is this the reason that portion of gain/loss is attributable to NCI of bochem?”
Yes
2 “How is the 30% calculated ? [Bochem had 80% holding,disposed of 50%”
What’s 80 less 50? The question says “Bochem disposed of 50% of the equity of Ceram” not “50% of the holding”
3 “Does that mean NCI-adjustment for Ceram ,should not be apportioned?”
I’m sure that the end of my previous post answered this! The examiner states that goodwill could be calculated using an alternative approach and that will result in radically different figures for goodwill and loss on disposal which will in turn affect the nci
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