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Hello Sir,
Could you please tell me how do we decide what is the date of acquisition in D shaped groups?
e.g. question 37 (BPP practice and revision KIT)
1.
B acquired 60% of the share capital of J on 01.01.2002 and 10% of G on 01.01.2003.
J acquired 70% of the share capital of G on 01.01.2003.In my opinion,
01.01.2002 is date of acquisition between B and J.
01.01.2003 is date of acquisition between B and G.
Since acquisition of 10% of G by B occurred on the same date as acquisition of 70% of G by B, we should consider acquisition of 10% of G as control interest increase which does not influence W2 goodwill calculation.2.
B acquired 60% and 10% of the share capital of J and G on 01.01.2003 respectively.
J acquired 70% of the share capital of G on 01.01.2002.Date of acquisition is 01.01.2003 because that is the date when J and G become Subsidiary.
Could you please advise if my understanding is correct?
Thank you in advance.
Hi,
1. J became part of the group on 01.01.02, whilst G became part of the group on 01.01.03 as these are the dates that we obtain control. A 10% ownership interest in G acquired on 01.01.03 is not enough to give us control.
2. Your understanding is correct on this one.
Thanks
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