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Dear Tutor,
The question 58c-Kate quoted that at 1.4.X5 Cate had direct holding of shares giving of 70% of voting right in Date. In May 20X6 Date issue new shares but to new investors. After the increase in capital Cate retain an interest of 35% of voting right in Date.
My question is The interest in Cate reduce due to increase in Date capital by issue share to other investor. Why this is called a sub disposal? Sorry, I confuse with the defintion.
This is what I read from Exam Technique for P2.its a sub disposal as with only 35% of the shares its now an associate and will no longer consolidate.
Cate had control of Date so if they issue shares its cate that made that decision.Ok Latoyah
huongnt, it’s called a DEEMED disposal and is treated by looking at the value of the 70% pre-issue holding and comparing with the value of the 35% post-issue holding
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