Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Equity and Cost Method
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MikeLittle.
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- September 21, 2016 at 10:53 pm #341281
Sir,
I ask about, which method is used, equity or cost? for both the investment in subsidiary (consolidation) and associate (no consolidation) ?
ThanksSeptember 22, 2016 at 1:46 am #341287Cost for the Subsidiary and equity for the Associate
Surely this is all in the course notes and in the videos
September 22, 2016 at 5:54 pm #341397But is it possible to use any of both at the subsidiary case ? as long as there is consolidated statements .
September 22, 2016 at 11:48 pm #341416NO!
In the case of the subsidiary we HAVE to use the profits as at date of acquisition
Is that ok for you?
September 23, 2016 at 4:49 pm #341479It is meant that we have to use only the cost method, at the subsidiary case ?
September 23, 2016 at 5:40 pm #341487Yes, IFRS 3 talks about an acquirer and an acquiree and cost method is the one to be applied
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