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Hello all,
I don’t understand why here the fair value adjustment of the subsidiary is added to the NCI.
Could anyone help me?
Hi there, yeah I supposed you are referring to the intangible asset of software $500,000. The question says:
“Also at the date of acquisition, Sander (sub) had an intangible asset of $500,000 for software in its statement of financial position. Picant’s (parent) directors believed the software to have no recoverable value at the date of acquisition and Sander wrote it off shortly after its acquisition”.
I cannot see either why it is included in the group retained earnings (from subs part) whilst deducting it as fair value adj when calculating goodwill ???
Could anybody help here?Thanks
Surely it’s already been deducted in arriving at the retained earnings figure for Sander (“Sander wrote it off shortly after its acquisition”) ad it clearly needed to be deducted in arriving at the fair value of the subsidiary’s net assets at date of acquisition for the goodwill calculation
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