Intra-Group Loan

Dear Sir, I will summarize all the adjustments that I should make with respect to intra-group loans when preparing consolidated financial statements..I want get those adjustments confirmed. In preparing CSOFP we remove loan payable and receivable figures.In CSOPL we deduct loan interest from both investment income and finance cost. Is that all? or should I make any adjustment to Group Retained Earnings and NCI (If loan is granted by parent to subsidiary) ? IF I don't need to make any adjustment to group RE or NCI, lets say a loan was given to subsidiary by parent and relevant interest on this loan is $1000. On consolidation we just remove this from investment income and finance cost. Right? However if there weren't such a loan subsidiary's profit will be increased by 1000 and parent's profit will be decreased by 1000. if this subsidiary is partly owned say 80% by parent..Parent's retained earnings will be again increased by 800 and NCI will be increased by 200.. So on consolidation net impact of the removal of interest on an intragroup loan given by a parent to a subsidiary should be, Parent Retained earnings should be decreased by (+800-1000) = -200 NCI should be increased by = +200 IF my logic is wrong, correct me.. But If you demonstrate that no adjustment should be made to retained earnings and NCI.. I expect the answer for following BPP question. ''On 1 July 20x7, Spider acquired 60% of the equity shares capital of FLY and on that date made a $10Mn loan to FLY at a rate of 8% per annum. What will be the effect on group retained earnings at the year end date of 31 December 20x7 when this intra group transaction is cancelled. A) RE will increase by $400K B) RE will be reduced by $240K C) RE will be reduced by $160K D) There will be no effect on group retained earnings. Answer is (C) loss of invesment income 10*0.08*6/12 = (400) Saving of interest payable 400*0.6 = 240 Net reduction in RE = (160) Thank you in advance.