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Hello Sir,
I am getting confused with aquisition of additional stake in a sub.
There are 2 questions; Dec 09 & Jun 11
For Dec 09:
when calculating the loss on acq [90-20%(414+7+5)-1(goodwill of nci)] then the fv of nci is 85.2+1=86.2 is used in computation of nci.For Jun 11:
calculating fv of nci [19-10%(98+3+30)-3.3(goodwill of nci)].
FV of nci (given = 46)I am confused as to why in this question fv of nci used for computing total nci is 46 and not 13.1+3.3=16.4
correction***
Jun 2011:
goodwill of nci is 2.93, 13.1+2.93=16.03why 16.03 is not used as fv of nci, compared to the quest Dec 09.
why is 16.03 less from computation of nci when calculating total nci.
Hi,
I’m a bit confused with what you’re confused with, if that makes sense. Both of the calculations have been done in exactly the same way.
We are given the NCI on the initial acquisition of the subsidiary, to which we then add on the increase in net assets attributable to the NCI. This then gives us the NCI at the date the additional interest is acquired.
Once we know the NCI at this date we can adjust for the change in percentage ownership between the NCI and the parent. The NCI figure remaining after the transfer is the figure to be used on the group SFP as the change in ownership is at the reporting date.
If you need any further help then just let me know.
Hope this helps.
Thanks
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