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company uses full goodwill method.
when that company increases its stake in a subsidiary from 60% to 80%. then NCI falls, by an amount that is proportionate to current carrying amount of NCI. Now current carrying amount of NCI is calcutled as FV at acquisition, then any post-acq changes in reserves and deduct any impairment of goodwill.
But instead of using the carrying amount of NCI calculated in the aforementioned manner my exam kit just completely IGNORES ANY IMPAIRMENTS and takes the rest as I mentioned earlier, and then does the required multiplications.
But this is insane! why ignore NCI share of impairments at all???????
Sounds far more complicated than the exam
Look at change in NCI – generally given in the exam – and compare to change in cash – difference to reserves.
If you look at the past exams on groups since the syllabus changed the questions are very simple.
If you are given the NCI at a date, then any impairment, if relevant, will already have been netted off.
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