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Equity Method

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Equity Method

  • This topic has 1 reply, 2 voices, and was last updated 1 year ago by P2-D2.
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  • Author
    Posts
  • May 27, 2024 at 6:36 pm #706141
    salardehbashi
    Participant
    • Topics: 22
    • Replies: 22
    • ☆

    Hello

    Supposing an investor has an associate with 30% share holdings and significant influence. The investor has always accounted this using the equity method.

    Some years later, the investor acquires additional shareholding in that associate and its significant influence still remain unchanged.

    How should we account for the new shareholding in that associate?

    Should we AGAIN determine the investor’s share of the net fair value of the associate’s identifiable assets and liabilities at new acquisition date?

    Should we recalculate the goodwill based on new shareholdings?

    Much obliged, Sir 🙂

    June 1, 2024 at 10:20 am #706360
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7228
    • ☆☆☆☆☆

    Hi,

    You will see how to adjust for this type of transaction in SBR, so I’d not worry about it at this level.

    Thanks

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