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Goodwill impairment

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Goodwill impairment

  • This topic has 5 replies, 3 voices, and was last updated 7 months ago by fredymaila.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • October 19, 2021 at 1:25 pm #638486
    alawi sayed
    Participant
    • Topics: 153
    • Replies: 167
    • ☆☆☆

    Hi Sir,

    The goodwill impairment it will added to consolidated expenses of p&L,

    but for the concern of retained earnings from which retained earnings it will be deducted from the parent or the subsidiary. Also do we have to divide it between parent and subsidiary.

    Thanks,

    October 20, 2021 at 8:03 pm #638646
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6473
    • ☆☆☆☆☆

    Hi,

    Yes, the impairment is an expense and so is added to the other expenses within the Group SPL, thus reducing the group profit. As it reduces group profit then it will also reduce the group retained earnings figure in the Group SFP.

    The impairment will be shared between the parent and the NCI using the fair value method. So, in the Group SPL we show the impairment figure in full on the Group SPL and then the split is done at the bottom where we attribute the NCI their share of the profit (incl. the impairment).

    In the Group SFP the split is done across the NCI working and the Group RE working.

    Thanks

    October 20, 2021 at 10:23 pm #638653
    alawi sayed
    Participant
    • Topics: 153
    • Replies: 167
    • ☆☆☆

    Thanks a lot ,now it is more clear ,Thanks,

    June 4, 2022 at 6:28 am #657303
    fredymaila
    Member
    • Topics: 48
    • Replies: 100
    • ☆☆

    Also, when calculating NCI as a proportion of FV of net assets,
    Goodwill impairment is only attributable to parent interest (group) and strictly not NCI.

    June 7, 2022 at 6:50 pm #657747
    alawi sayed
    Participant
    • Topics: 153
    • Replies: 167
    • ☆☆☆

    Thanks

    June 20, 2022 at 5:35 am #659019
    fredymaila
    Member
    • Topics: 48
    • Replies: 100
    • ☆☆

    alawi sayed wrote:Thanks

    Ok

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