When a subsidiary is acquired with a view to sale, there is a 3 month period from the date of acquisition for it to meet IFRS 5 criteria to be classified and accounted for as held for sale. So lets say, the date of reporting is December, and the entity bought a subsidiary with a view to sale on November, what method should i use to that entity, should i follow IFRS 10 and consolidate it or IFRS 5 and classify it as held for sale at current asset?
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IFRS 10 and IFRS 5
13y ago#1I don't know! And I have never been asked that before. I suppose you could wait until February and then confirm the subsequent event of Held for Sale classification and treat it as an adjusting event giving greater certainty to a condition or situation that existed at the year end date
But I'm not 100% on that
But I'm not 100% on that
Thanks for your help. I shall treat it as such if such questions arise for this coming exam.
13y ago#3Let's hope it doesn't come up because, as stated, I'm not 100% certain!
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