Hello, in doing the Viagem Co group consolidated statement of Profit or Loss and calculating goodwill on acquisition of a subsidiary there is a mention of a contingent liability in relation to a group. It rings a bell from one of the lectures, but I cannot recall what it was and unfortunately I cannot fnd it anywhere. Could you please remind me what it was? I only seem to remember that it was supposed to be a current liability?
The contingent liability within the subsidiary is recorded at fair value within the group accounts. This adjustment will reduce the net assets at acquisition as we are recording a liability.