Sir, if a company owns 80% of another company, (provided that they have inter-firm transactions) then when we are doing consolidated balance sheet, before working for the adjustment (inter-firm transactions)should we add only 80% of the receivables and payables of subsidiary or 100%?
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consolidation
sorry, intra-group trading i mean.
9y ago#2You show 100% of all assets and liabilities.
I do suggest you watch my free lectures on group accounts (the lectures are a complete free course and cover everything needed to be able to pass the exam well).
9y ago#3Hi
The book is written if sale is made from Parent to Subsidary so there is no unrealised profit attributable to NCI.
And there is an exercise - Jessica Co acquire 75% of Patpost Co and sell goods to Patpost and 50% is remain in inventory.
And why the answer they deduct unrealised profit from NCI???
9y ago#4It is true that if a sale is made from the parent to the subsidiary, then the unrealised profit is not attributable to the NCI - it is subtracted from the inventory and from the retained earnings of the group. This is dealt with in our free lectures (the lectures are a complete free course for Paper F3 and cover everything needed to pass the exam well.
I have no idea why it is been subtracted from the NCI in your exercise - if you have copied the details correctly then it seems there is a mistake, but I cannot be sure without seeing the whole question and answer.
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