ACCA SBR · Guided practice (Show me how)
Chapter 7: Group statement of cash flows
Group statement of cash flows - Dove group
Chapter 7, Example 4 - Group statement of cash flows. The following draft group financial statements relate to Dove, a public limited company.
| Dove group SFP at 31 December ($m) | 2015 | 2014 |
|---|---|---|
| Property, plant and equipment | 1,745 | 1,250 |
| Goodwill | 1,184 | 1,230 |
| Investment in associate | 200 | 190 |
| Inventory | 530 | 580 |
| Receivables | 456 | 390 |
| Cash and cash equivalents | 190 | 230 |
| Total assets | 4,305 | 3,870 |
| Share capital | 1,700 | 1,500 |
| Retained earnings | 1,060 | 900 |
| Non-controlling interest | 575 | 540 |
| Long-term borrowings | 300 | 200 |
| Deferred tax | 220 | 190 |
| Trade payables | 300 | 430 |
| Current tax payable | 150 | 110 |
| Total equity and liabilities | 4,305 | 3,870 |
| Dove group SPL for the year ended 31 December 2015 | $m |
|---|---|
| Revenue | 1,765 |
| Cost of sales | (1,185) |
| Gross profit | 580 |
| Distribution costs | (100) |
| Administrative expenses | (90) |
| Operating profit | 390 |
| Finance costs | (55) |
| Share of profit of associate | 40 |
| Profit before tax | 375 |
| Taxation | (95) |
| Profit for the year | 280 |
| Dove group SOCE ($m) | Equity shares | Retained earnings | NCI |
|---|---|---|---|
| B/f | 1,500 | 900 | 540 |
| Issue of share capital | 200 | ||
| Dividends | (65) | (20) | |
| Total comprehensive income for the year | 225 | 55 | |
| C/f | 1,700 | 1,060 | 575 |
- On 1 June 2015, Dove acquired all of the share capital of Fred for $50 million. The fair value of the identifiable net assets and liabilities at the date of acquisition, reflected in the year-end balances of the Dove Group, were: property, plant and equipment 13; inventory 20; receivables 15; cash and cash equivalents 3; payables (9); total 42 ($m). Goodwill arising on this transaction was $8m.
- Dove owns 20% of an associate. The associate made a profit for the year of $200 million and paid a dividend of $150 million.
- During the year Dove charged depreciation of $130 million on its property, plant and equipment. It sold property, plant and equipment with a carrying value of $43 million for $50 million.
All figures are in $m.
Workings: impairment and working capital
Calculate the goodwill impairment and the movements in inventory, receivables and payables for the Dove Group statement of cash flows for the year ended 31 December 2015.
(i) Cash generated from operations
Calculate the cash generated from operations for the Dove Group for the year ended 31 December 2015.
(ii) Net cash on acquisition
Calculate the net cash paid to acquire the subsidiary for the Dove Group statement of cash flows for the year ended 31 December 2015.
(iii) and (iv) Dividends
Calculate the dividend paid to the non-controlling interests and the dividend received from the associate for the year ended 31 December 2015.
Opening this exercise…