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In the CSFP as at 31 Mar ’04, will the investment under Non Current Assets be presented like this?
– Investment (15,000+3,000) + 50,000 (recording the investment in subs) – 50,000 (then deducting the investment in subsidiary) + 1,500 (FV adjustment) – 15,000 (deducting investment in subsidiary)
– Investment (3,000+1,500) = 4,500
Hi frafiq
I think I recorded the answer to Hapsburg in the worked examples. Please check out my recorded answer and, if you still have a problem, come back to me
Hello Sir,
Yes I have seen that video but sorry I couldn’t understand it. Actually I usually have an issue while stating the “investment” in the CSFP, so if you could please confirm what I have stated above is correct or not.
Secondly a correction in step 1 stated in my first post:
15,000 (deducting investment in associate)
I hope you don’t mind. Thanks.
Hi
I don’t have the question to hand. However, when calculating a consolidated “Investment” figure, we EXCLUDE any investment in subsidiaries.
As for the cost of acquiring shares in an Associate, that cost is the start point for Working 5A ( Investment in Associate Company ).
the full working for W5A is:
Cost of investment, plus
Share of post acq retained earnings in Associate, less
Any impairment of the investment ( which will be given in the question )
It is, of course, possible that a question will include within the “Investments” figure for either the parent or the subsidiary, an investment ( like a painting or other work of art ).
So, exclude “Investment in subsidiary”
Show separately “Investment in Associate” as per above working W5A
Any other investments such as works of art, add across the “other investments” of the parent to the “other investments” of the subsidiary
Better?
Sir,
Investment in associate is easy in this question and I can figure out how the 15,000 comes for that.
With what you have explained above, the “investment” (excluding the investment in assoc) should have a figure of (15000+3000)+1500 (fv adjustment)=19,500 where as the answer to the question gives a figure of 4,500.
I guess you will have to look at the question 🙂
But I don’t know now where I would start looking – I’ll keep my eyes open for Hapsburg
Sir, here is the link for the question (its on Page 20)
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