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Group consolidation – Intangible Asset

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Group consolidation – Intangible Asset

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  • May 26, 2017 at 9:47 am #388207
    satheesh90
    Member
    • Topics: 36
    • Replies: 25
    • ☆☆

    Dear Sir

    M/s X ltd acquires M/S Y Ltd . At acquistion a fanchisee Right which is granted by X ltd is appearing in the SFP of Y and also given the Franchisee has a market value.

    Can we include the value of the Franchisee right in Net Assets for calculating the Good will calculation ? As a group it will not come under the scope of “INTERNALLY CREATED INTANGIBLE : ?

    Regards

    Satheesh

    May 30, 2017 at 9:42 am #388938
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7090
    • ☆☆☆☆☆

    Hi,

    If the item has a fair value then it will be consolidated and included as part of the net assets at acquisition. I’d imagine that it would then be eliminated on consolidation as it is an intra-group item.

    Thanks

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