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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Fair value adjustments (Page 14)
Sir what do u mean by extra deprn and sale of inventory under this heading? I wasnt able to understand this in the lecture
Hi,
If the assets of the subsidiary have been increased to fair value then if it is a depreciable asset then the fair value will need to depreciated too as it won’t have been depreciated in the subsidiary’s books as it is only fair valued on consolidation.
If the fair value of inventory is adjusted for on acquisition of the subsidiary then if it has been subsequently sold by the reporting date then the fair value adjustment is no longer shown at the reporting date.
Hope this helps but again these are more likely to be seen in F7.
Thanks