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Hello
I would like to ask a question about discontinued operations, from Mar Jun 2023 Q3b Landry Co.
In the answers it says that Landry Co can be classified as held for sale.
But it also says that Landry Co is not a discontinued operations because there is “no information to state that the operations have ceased”I wanted to know how one would decide if a held for sale is classified as Discontinued Operations.
Is this because the sale has not yet been finalised and no contract has been signed?
I understand that discontinued operations can be classified into 2 groups:
disposed of
Held for saleThe disposed of portion is easy to understand but Held for Sale is a little more tricky.
Also I wanted to clarify if the finalising of the contract happens after year end.
Does it classify as discontinued Operations?
Because for Sep Dec 2020 Q3.
The Year end of the Financial Statements was 31 March 20X5.
But the finalising of the contract happened on 1 Aug 20X5.
The answers conclude that the scientific publishing division is a discontinued operations. But I am unsure on why.Sorry the Question from Landry Co. is from Mar Jun 2024. Q3b, not 2023.
Landry Co
The Group is in the process of arranging to sell Landry Co, one of its wholly owned subsidiaries where Landry Co is currently the only subsidiary which operates from a foreign country. The audit file states that negotiations with two prospective buyers are in progress and the Group has set the sales price at $90 million. The carrying amount of Landry Co in the consolidated financial statements, including goodwill, is $78 million and the company contributed revenue of $144 million and profit before tax of $10·1 million to the Group during the year to 31 March 20X5. One of the potential buyers has used an independent firm to prepare a due diligence report on Landry Co’s assets and liabilities. The potential buyer is expected to make an offer to purchase the company once this process is complete.
The Group finance director has not made any disclosures with respect to the potential upcoming sale in the consolidated financial statements for the year ended 31 March 20X5, as the sale has not yet been finalised and no contract has been signed.
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