hello sir,
for q 49 in exam kit (preparation ques for foreign subs)
i tried you method to convert everything at closing rate but my SOFP wont match.
Cons RE c/f what i got is
parent 1115
subs post acq share
(2200/8.1) *80% 218
-------
1333
impairment our share (21)
-------
re 1312
cons NCI
value @ DOA 66000
share of post acq
(2200/8.1)*20% 54400
---------
120400
please help me i lost my confidence
Ask the Tutor ACCA SBR
foreign subsidary
I assume you have been doing the questions from the BPP kit. What BPP does is that they use closing rates on everything except the equity. On which they use the rate on acquisition date.
The method that Mike uses is NOT incorrect. It is an allowed alternative. It confused me as well when I looked up the answers. So, fear not, as the method that Mike uses has not prevented the previous students from passing the exam as it wont prevent us.
ya but the problem is i am not getting the same answer.. but anyway i think i will be using BPP method as now I am more comfortable with that
thanku :)
11y ago#3Thanks Hammad :-)
Shreya, in any situation where there are alternative treatments available, it's going to be the case that answers will differ.
Answers should be the same where the difference is in the way in which one arrives at a calculated figure but if it's a difference in something like foreign currency translations, then of course your answer will be different when compared with the answer that has been arrived at using a different methodology
Cash flow alternative presentations of, for example, dividends paid where they may be included within operating activities or within financing activities will clearly lead to different subtotals on the cash flow statement
Ok?
yes but RE and NCI calc should match?.. i tried solving many times but may be i am making a mistake somewhere and as i dont have the answer as per your method, it is difficult to understand.
but then i tried bpp method (equity as per DOA and post acq RE as the bal fig) i think i will use this now because now no time to try on new thing :( .. well i got more confused because my lecturer taught me something else and i was left with 3 methods lol .. so BPP it is.. but thank you sir for helping me :) i hope this time i will pass :)
11y ago#5I hope so too Shreya
(RE and nci will not be the same because BPP translate RE at date of acquisition at the rate as at date of acquisition whereas my way translates all at closing rate and hence the two methods will not arrive at the same end figure)
But if you prefer one method over another, that's not a problem
Good luck
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