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Just a new thought come to my mind that the above stated is valid in case we have goodwill impairment only.
If we have PPE impairment for instance (in addition to goodwill, as it was in the past exam we talked about) PPE impairment should relate to Sub RE, right?
Anyway, just to be on the safe side, i will use your approach and will not think about impairment any more……
the result should be the same…
however in essence it is not right, as impairment should not affect on Sub RE
it affects on P’s share in sub and NCI
I will stick to your approach!
Thank you very much!
yes, it is! thank you very much!
and the very last question regarding impairment ))
in full goodwill approach:
why in W3 – parent RE calculation, you are deducting impairment attributable to parent from parent RE and then in w4 – NCi calculation – impairment attributable to NCI from NCI
whereas you can save your time by deducting full impairment from Sub RE in w3 and then apportion it to parent and NCI?
is there any trick?
how did you come to 153.3?
And is it because of full goodwill is impaired and we have additionally PPE impairment?
Otherwise if no PPE impairment would be involved we had to just allocate this 300.3 on the proportion of 60%/40%?
yes, the amount of 53.3 in impairment of goodwill in Park.
It was deducted from impairment amount of 300.3….
And then we have the balance of 247, which should be allocated between parent and NCI
Ok, clear.
But as per June, 2013 approach, we deduct from impairment amount of 12 000 the NCI notional goodwill of 10 000.
Is there any reason for that?
Thank you, Mike!
Sorry, but here is another silly question on impairment with partial NCI.
Could you please advise how the total impairment figure have to be apportioned between parent and NCI?In past exam questions I found 2 different approaches (but there are different group structures in it ):
1. Impairment for NCI is unrecognized NCI % of goodwill (notional goodwill on NCI) – June, 2013 – vertical gruop
2. Impairment for NCI is NCI% of impairment figure – Dec, 2011 – tentthank you!
Hi Mike,
Let me rephrase my question. As I understand in order to identify the impairment figure we need to compare recoverable amount with the sum of goodwill+net asset.
What confused me is that why in 1Q, December 2012 recoverable amount was compared with goodwill+asset?
Thank you!
