Consolidated Balance Sheets - Can any help!

Chrissiemartin1

I am struggling with Consolidated Balance sheets and how you do them tI have read the example in the book about 4 times and I still cant get it right - any help please ..... is hoping the penny drops soon!

Thanks in advance xx:thumbup1:

princess246

Hello

First thing that you need to get your head round is the workings, as you cannot consolidate the balance sheet until you have worked out your workings.

Do you understand how to do the workings?

peugeot

I did an article on consolidated balance sheets, which can be found here

I hope it helps.

Kind regards
Steve

visha

Consolidated balance sheet
This question is not about adding across the two balance sheets but 85% of the marks are allocated to the 5 workings that you MUST show to an examiner
Working 1- Relationship (5%)
Show what percentage dos the Parent company owns of the subsidiary. Say 75% (A)

Working 2 (2 parts) – Valuation of S- subsidiary at Acquisition date and Balance sheet date (40%)
Share Capital…………………………………@ A date……………………………………..……………………@ b/s date
Share Premium…………………………….@ A date……………………………………………………………@ b/s date
Retained profit & loss…………………@ A date……difference= this years profit…(B)…… @ b/s date
Property Valuation……………………..@ A date…………………………………………………………..@ b/s date
Total value of S at ……………….Acquisition Date…(C)……………………………………….Balance sheet Date (D)

Working 3 Goodwill calculation (20%)
Valuation of S at the acquisition date (C) in working 2 times (A) in working 1 = Value of S acquired (E)
Payment for the investment in the Subsidiary (from P’s balance sheet) less Value of S acquired (E) equals GOODWILL.
GOODWILL less amortisation (E) equals GOODWILL to be shown in the consolidated balance sheet.

Working 4 – parent’s company’s Profit & loss A/C (15%)
P’s Retained profit and Loss
Plus (this year’s profit of S (B) in working 2 times (A) in working 1)
Less goodwill amortisation (E) from working 3
Equals Retained profit for the Parent company to be shown in the consolidated a/c

Working 5 – Minority interest (5%)
Valuation of S at the balance date (D) from working 2 times the minority % This working will go as a minority interest on the consolidated balance sheet.

Consolidated Balance sheet of the GROUP as at DATE (15%)
Non-Current assets
Goodwill ( NET of amortisation) from working 3 (E)
Total of premises of both P & S plus Revaluation (5%) (students very often forget this)
Total of other fixed assets of both P & S

Current assets
Total of Current assets of both P & S

Non Current assets
Total of Non-Current assets of both P & S



Represented by ( ONLY FIGURES FROM P’s Balance Sheet) (5%)
P’s Share Capital
P’s Share premium
P’s Retained Profit – working 4
S’s minority interest – working 5

Consolidated completed and balanced.

Chrissiemartin1

Not really

Chrissiemartin1

peugeot wrote: »

I did an article on consolidated balance sheets, which can be found here

I hope it helps.

Kind regards
Steve

Steve I cant view this article can you email it to me chrissiemartin@harwoodhutton.co.uk
thanks

visha

which part of workings you do not understand?

start with working 1

do you understand this working?

peugeot

Hi,

Unfortunately I can't email you the article, but if you log on to

www.accountancystudents.co.uk

Then go into Articles, and Financial Reporting, the consolidated balance sheet article is there.

Kind regards
Steve

princess246

Hello

Have you got any further with getting to grips with this?

Chrissiemartin1

thanks