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Hi
Just would like to know if I can do the workings first and then do the consolidated BS/IS or should set out the pro forma BS/IS first and then the workingsproblem is if I set out the BS/IS first I do not know how much space to leave
will I get penalised for showing the workings first?
Anisa, there really is no other way to do it – you have to do the workings first before you get into the balance sheet.
There are NO MARKS for writing out a pro-forma so get stuck into those workings.
IOf you are asked to write a report commenting on financial performance or financial position, you need to calculate ratios. But they should be shown in an appendix. And an appendix comes at the end of the report. So how do you know how much you’re going to write in a report and therefore where your appendix should start? DO THE APPENDIX AT THE START OF YOUR ANSWER!
In a real life situation, you’d cut and paste. But exams are not real life! How many times, in practice, is goodwill actually calculated? (Not reviewed for impairment – how many times is it actually CALCULATED?)
Once! In the year of acquisition. So when an exam question says “The parent acquired the shares in the subsidiary some 4 years ago,…..” and we have to calculate goodwill for the exam answer – we’re moving away from reality.
Don’t waste your precious time writing out a proforma, and do the workings first!
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