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In the question. SD holding goes from 60% to 80% 8 months during the year. When calculating the NCI 40% of the 8 months profit is aded on but then 20%/40% is taken off the NCI at acq plus the 8months at 40%. Why is it taken off the portion pre the additional acq of the 20%?
Hi,
They have calculated the NCI at the date of change in ownership and then looked at the amount of NCI that has been transferred to them.
Given that the previous NCI was 40% and is now 20% then we multiply by the 20%/40%, essentially working out how much each 1% is worth by dividing by 40% and then working how much 20% is by multiplying by the 20%.
It is then taken off as the NCI has reduced.
Thanks
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