GROUP STATEMENT OF CASH FLOWS WITH A DISPOSAL

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August 15, 2019 at 9:02 am #527699
caroline
Member
- Topics: 6
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Good day,I need help with understanding why the fair values of working capital items(inventory, recievables and payables) of a subsidiary being disposed during the reporting year must be added when calculating the movements to be posted to the statement of cash flows.please help
August 18, 2019 at 7:30 am #527925
P2-D2
Keymaster
- Topics: 4
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Hi,
The assets/liabilities of the subsidiary must be at fair value within the group accounts, so if the fair value is higher than the carrying value then we must add the fair value uplift to the carrying value of the asset.
Thanks
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