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Hi sir for December 2014 exam, question on PLASTIK, we dont have to account for the finance costs on the loan note because it was only issued by Subtrak at the year end right ?
I just want to clarify. Generally, for intergroup loan notes does it matter whether the loan note was issued by the parent or subsidiary and will the adjustments vary accordingly ?
“… because it was only issued by Subtrak at the year end right?” – correct
“… does it matter whether the loan note was issued by the parent or subsidiary and will the adjustments vary accordingly” – cancellation will be involved whichever entity issued the loan note and the general principle will apply but the extent of cancellation will vary dependent upon whether the buying entity takes 100% or not
OK?
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