[satheesh90]

Thank you very much sir

[satheesh90]

thanks a lot sir

[satheesh90]

Thnks

[satheesh90]

To be more clear :- Why we can not treat the item as FINANCIAL LIABILITY ” rather than as Deferred tax ?

[satheesh90]

passed with 78% …

[satheesh90]

Sir.. hope now you are in a position to answer my query . why revaluation is 1 Million only.. why it is not 1.55 ( 23-(22-(22/20*6/12)).

Thanks Mr. Complicated

[satheesh90]

Sorry.. I would like to with drawn the query as I am convinced with the calculation

[satheesh90]

Ohh.Thank you very much.. some times it is confusing ….

[satheesh90]

I cancel this question as I found this is foolishness.. The basis of this question was due to the wrong understanding of the LET RELIEF. Instead of taking the charged months for the calculation of letting relief, I had taken for the entire period of Occupancy….

Sorry for the inconvenience caused

[satheesh90]

Kindly confirm sir

[satheesh90]

Sorry it is not clear..

kindly clarify with following examples:-

P Ltd One subsidiary S and one associate A :- In separate statement ecost or IAS 39
Consolidated :- EQUITY METHOD

P Ltd only Associate A :- No consolidation required and Investment should b
either at cost or IAS 39
Is it correct ???

In the question if it is not clear whether any subsidiary exist or not, Which method should be applicable ?

[satheesh90]

Yes.. Thanks

[satheesh90]

I cancel my question as I convinced my self that Class 4 is based on trading profit for the year and time period has no role .

Thanks

[satheesh90]

Disagree… Because consolidated sales has to be lowered to the extend of 100,000/- .

After posting the question I once more reviewed the issue and found the following Logic:

Treat it as the reversal of trxn in P’ books and so sales (100,000) has to be lowered and cost of sales is to be lowered to the extend of the of COST (ie. 80000) and so remaining 20000 which is UNRELEASED PROFIT will be automatically adjusted..

Is it correct Sir ?

[satheesh90]

yes.. got it sir

Thanks

[satheesh90]

ohhhh.. Surely… Got it .. But in text also I thing Hides this point

Thanks A lot .. It is now very much clear

[satheesh90]

Correct .. that I understand.. But in the question it is asked what is the effect of this trxn on GROUP INVENTORY ?

Sir, As we are not combining the inventories of Parent & Associate, I do not understand the logic of deducting the unrealized profit from Group’s inventory.

[satheesh90]

Thanks .. Absolutely OK

[satheesh90]

Unfortunately No… Sir ..

For the Second comment :

If the seller is the S for the goods transfered to H, then we would have considered (DEDUCTION) the unrealized profit to derive the profit figure for S and then proportionately divided between NCI and Group Retained earning.

Why the same logic is not applied for the interest expenses of S which is to be paid to H..

For the First Comment:-

It is considered while calculating the Group retained earning as follows :

H ‘s profit = 55000(60000-5000)
S’s profit = 25000 (20000+5000)

So total 80000

Kindly comment .

[satheesh90]

Sir,

I have not seen any scope for interest on loan in the question.

I strongly doubt you are mentioning about a different question. The following is the question which I was referring. :-

Question 8 On 1 April, 2009 P purchased 80% of the equity shares in S. The acquisition was through a share exchange of three shares in P for every five shares in S. The market prices of P’s and S’s shares at 1 April, 2009 were $6 per share and $3.20 respectively.
The following information for the equity of the companies at 30 September, 2009 is available:

P S Equity shares of $1 each P-200,000 s-120,000
Share premium P- 300,000
Retained earnings 1 October, 2008 P- 40,000 S- 152,000
Profit for the year ended 30 September, 2009 P- 47,200 S- 21,000

The fair values of the net assets of S at the date of acquisition were equal to their carrying amounts with the exception of an item of plant which had a carrying amount of $12 million and a fair value of $17 million. This plant had a remaining life of five years (straight-line depreciation) at the date of acquisition of S. All depreciation is charged to cost of sales.

In addition S owns the registration of a popular internet domain name. The registration, which had a negligible cost, has a five year remaining life (at the date of acquisition); however, it is renewable indefinitely at a nominal cost. At the date of acquisition the domain name was valued by a specialist company at $20 million. The fair values of the plant and the domain name have not been reflected in S’s financial statements.

The non-controlling interest in S is to be valued at its (full) fair value at the date of acquisition. For this purpose S’s share price at that date can be taken to be indicative of the fair value of the shareholding of the non-controlling Interest.

[satheesh90]

OK.. thanks

[satheesh90]

Ok sir, but my doubt is as the excess depreciation in charged in the buyer’s P&L and so why the reinstatement of the same is not done in the buyers books itself .

Satheesh RV

[satheesh90]

My question was with respect to individuals.. not corporate . kindly refer the page No-49 Of Text by option tutions

Thanks

[satheesh90]

ok. sir.. thanks

[satheesh90]

Yes. I have seen in the BPP text book for F7. The above example is also from the same text.
Are you suggesting IFRS 15 is not a part of F7 ?

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