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Dear Sir I shall be very thankful if you could help me with a problem Thanks.
*-How do we account for an OCI reserve in sub @ acq. if we prepare the consol. SOFP @ the same date ?*-If such an OCI reserve arises in the Sub after acquisition do we analyse it between parent’s portion and NCI portion or just show a single line in the Consol SOFP as ‘OCI reserve’ ?
If it exists at the date of acquisition, it is included in working 2 as part of the goodwill calculation – it’s part of shareholders’ funds / fair value of net assets at date of acquisition.
If there is movement in that reserve subsequent to acquisition then, yes, the nci want their share of that movement. But the W4A deals with that in the “normal” way. “Nci value at date of acquisition + their share of post-acquisition retained ( and their share of the post-acquisition movement in any other reserves ) – their share of any goodwill impairment”
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