[faraz1277]

Dear sir,
What is the treatment of it, while making the Group Retained earnings??

[faraz1277]

i think 3m repair cost should be capitalised as it s a major damage.
and 3m to be expensed
yeah but not sure

[faraz1277]

i have a doubt that as per the rule we nullify the common interest income and interest expense.. so in this question common interest exp and income was $20000. so why are we only deducting this from subsidiary’s finance cost and the apportioning it? should it not be that we just do like this
i.e $200000+$35000(70000*6/12)-$20000 (intra group interest)= $215000.. please could you just tell where exactly is my logic going wrong ?? and help me out with it?

Thanks

[faraz1277]

so basically it is a self interest threat because auditors would choose such NED who would recommend their name so ultimately they would get high fees again so there is a monetary benefit which is compromising thier independence right?

i have one more question that it can also be familiarity threat right? like if external auditors appoint NEDs who are their relatives or friends , if you could confirm?

[faraz1277]

But why will this amount be capitalised as part of PPE. Which concept is being applied here if you could through some light on that sir.,

thanks.

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