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When a parent disposes part of its interest in a subsidiary while retaining the subsidiary, the increase in NCI is calculated as % of sub disposed x (Sub’s total net assets + goodwill).
My question arises when the proportionate method is used for goodwill. Does it mean the goodwill should be grossed up before being fed in the formula above since the goodwill will only represent the parent’s portion?
Thank you
Hi,
You are correct, well done. You will see this in some of the older past exam questions when the updated IFRS 3 came into effect.
Thanks
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