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Hi All,
I see in one question ( SBR Specimen 1b) Goodwill impairment is not included while calculating group gain/loss on disposal of subsidiary. I did not understand why? I was always thinking goodwill should be included to gain/loss calculation with carrying value as of disposal date?
May I ask what is the rational behind excluding impairment?
When you calculate the profit or loss on the sale of a subsidiary you are comparing the proceeds with the carrying amount of the subsidiary.
The carrying amount comprises the net assets plus the goodwill net of impairment less the NCI all measured at the date of disposal.
You are sweeping all of the above out of the balance sheet and replacing it with some lovely cash.
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