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First of all, thank you OT for a fantastic resource. It is a great help to self-studying students.
A couple of remarks. Page 39 of the OT P2 notes (Chapter 9) – the pro-forma for the statement of cash flow. Sorry if this has been remarked elsewhere (I missed it) but the ‘share of associates profit’ should have brackets around the X – that is, (X), because it is a deduction from, and not an addition to, the profit-before-tax figure. As a student this tortured me for hours, and from memory the excellent Chris doesn’t mention this in the video lecture either.
Secondly, page 63, Ch. 16, example 1…what does ‘has in issue’ mean with regard to shares? Does this mean Lisa ‘issued’ them, or ‘purchased’ them? And who has the right to the way the shares are redeemed? The issuer, or the purchaser?
Many thanks, Brian
Hi,
Thanks for the kind comments. We do out best and its glad to feel that what we do is worthwhile for our students.
You’re right about the share of profit of associate, I thought I’d corrected it a while ago but clearly hadn’t. I’ll get it updated ready for the September sitting. I hope you didn’t torture yourself too much.
If Lisa has the shares in issue that they are Lisa shares for which cash will have been received when the shares were issued. Again, I think the question needs to be slightly amended in that it should say that they are convertible at the option of the investor and so treated as equity. If it were at the option of Lisa then it would be better to pay the cash and hence a financial liability.
Thanks
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