SOFP – Ammended Past Paper Question.

Please solve the question below and post your answers not calculations for Total Goodwill, NCI, Reserves and also the figure which balances SOFP!

Q has been updated to reflect changes introduced by IFRS 3 and the examiner?s recent articles
On 1 October 2009, Pumice acquired the following non-current investments:
– 80% of the equity share capital of Silverton at a cost of $13.6 million.
– 50% of Silverton’s 10% loan notes at par.
– 1.6 million equity shares in Amok at a cost of $6.25 each.
The summarised draft balance sheets of the three companies at 31 March 2010 are:
Pumice Silverton Amok
$000 $000 $000
Non-current assets
Property, plant and equipment 20,000 8,500 16,500
Investments 26,000 Nil 1,500
______ ______ ______
46,000 8,500 18,000
Current assets 15,000 8,000 11,000
______ ______ ______
Total assets 61,000 16,500 29,000
______ ______ ______
Equity and liabilities
Equity
Equity shares of $1 each 10,000 3,000 4,000
Retained earnings 37,000 8,000 20,000
______ ______ ______
47,000 11,000 24,000
Non-current liabilities
8% Loan note 4,000 Nil Nil
10% Loan note Nil 2,000 Nil
Current liabilities 10,000 3,500 5,000
______ ______ ______
Total equity and liabilities 61,000 16,500 29,000
______ ______ ______
The following information is relevant:
(i) The fair value of Silverton’s assets were equal to their carrying amounts with the exception of land and plant. Silverton’s land had a fair value of $400,000 in excess of its carrying amount and plant had a fair value of $1.6 million in excess of its carrying amount. The plant had a remaining life of four years (straight-line depreciation) at the date of acquisition.
(ii) In the post acquisition period, Pumice sold goods to Silverton at a price of $6 million. These goods had cost Pumice $4 million. Half of these goods were still in the inventory of Silverton at 31 March 2010. Silverton had a balance of $1.5 million owing to Pumice at 31 March 2010 which agreed with Pumice’s records.
(iii) The net profit after tax for the year ended 31 March 2010 was $2 million for Silverton and $8 million for Amok. Assume profits accrued evenly throughout the year.
(iv) An impairment test at 31 March 2010 concluded that consolidated goodwill was impaired by $400,000 and the investment in Amok was impaired by $200,000.
(v) No dividends were paid during the year by any of the companies.
(vi) Pumice Group’s policy is to value the non-controlling interest at fair value at the date of acquisition. For this purpose, Silverton’s share price at that date of $5 can be deemed to be representative of the fair value of shares held by the non-controlling interest.
Required:
Prepare the consolidated statement of financial position for Pumice as at 31 March 2010.