- December 7, 2021 at 8:36 am #642881ilievasParticipant
- Topics: 7
- Replies: 5
I stumbled upon couple of questions that made me doubt my knowledge regarding mid-year acquisitions.
At first I thought that the moment I see an acquisition month/date I take that up till the date of conso report and use that fraction for all accounts related to the subsidiary.
I do understand that i am somehow wrong and saw the following pattern:
P&L – always use a fraction from time acquired till conso FS
BS – not always , in case that the acquisition happened on 01/01 then we do not use the time apportion but when do we also not do it then?
Would you please confirm if this is so?
I specifically got to think this way because in ex. 259 from BPP we have an acquisition on 01/10/20×8 and prepare the conso FS as at 31/03/20×9 ( and need to prepare SFP) and we do not take the time apportion into consideration.. Why?
Thank you for the clarification!December 11, 2021 at 11:42 am #643894P2-D2Keymaster
- Topics: 4
- Replies: 6443
We never time apportion the assets/liabilities on consolidating, regardless of when the acquisition took place. The SFP looks at the assets/liabilities at a point in time and at the reporting date we control them all, hence consolidate them in full.
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