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Dear all , this post maybe old but its still applicable till now.i hope if theres still anyone here to help. Could i check with you on this , we gross up the goodwill to include the NCI’s , but when we compare with RA to find out impairment , if RA is already 60% , why do we still need to gross up ? Isnt it comparing 60% to 60% is more appropriate? I understand the concept of grossing up , its just the RA part because it is proportionated to parents share (which is * with 60%). I hope i have brought out my confusion clear here ?
And also anyone could help with the goodwill balance in SOFP ? Theres an closing bal of 130 in yeae 2005 and 120 in year 2006. Any workings for the cashflows ?
Dear Mr Mike ,
Thanks for the illustrations and detail explanation , appreciate that!!
Able to understand more with the illustration .However , with this , what does the bonus issue benefit the Company ? Or is the bonus issue benefits the shareholders ? I cant see what is the benefits of having bonus share issues (Either for investor or company) to have other than letting the shareholders to own more shares , on the other hand also bring down the EPS, etc.
Why i mentioned above is because -which i tried to udnerstand more from Google articles , many of them tend to practise this bonus issue as a “Reward” for the shareholders .
While i am trying to think more in depth with the accounting treatments….looks like it does not give any goods ?
My mind headed two directions :
1) WIth more shares ,they may get more dividends payout (Assuming the company is performing)
2) On the other hand , with more shares, the earning per share also reduces , so…..Please enlighten me . If you have any articles you could share with me also ??
Thank you !!