Consolidated statement of financial position

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hawke42
hawke42 Registered Posts: 4 New contributor 🐸
in AAT Level 4 (Level 8 in Scotland)
I have an assessment to complete regarding consolidated accounts. I have the following information:-
Forth plc has one subsidiary undertaking Vale Ltd.
Statement of financial position as at 31/3/11 - INVESTMENT IN VALE £21,000 (under non-current assets)
The share capital of Vale Ltd consists of ordinary shares of 50p each. Ownership of these shares carries voting rights in Vale Ltd. There have been no changes to the balance of share capital and share premium during the year. No dividends were paid or proposed by Vale Ltd during the year.
Forth plc acquired 14,000,000 shares in Vale Ltd on 1/4/10
At 1 April 2010 the balance of retained earnings of Vale ltd was £5,240,000
The fair value of the non-current assets of Vale Ltd at April 2010 was £21,500,000. The book value of the non-current assets at 1 April 2010 was £15,500,000. The revaluation has not been recorded in the books of Vale Ltd. (ignore any effect on the depreciation for the year)
Included in trade receivables for Forth plc and in trade and other payables for Vale Ltd is an inter-company transaction for £600,000 that took place in early March 2011

The directors of Forth plc have concluded that goodwill has been impaired by 205% during the year.
Forth plc has decided non-controlling interest will be valued at their proportionate share of net assets.

GOD WHERE DO I START????

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  • CeeJaySix
    CeeJaySix Registered Posts: 645
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    Hawke,

    We seem to be missing one piece of information - what is the total share capital of Vale? From the information given we can guess at the total of share capital and share premium (book value of NCA at 1/4/10 less retained earnings at 1/4/10, assuming there is no other equity). However we can't split this between share capital and share premium, which we need to be able to do to calculate non-controlling interest for the goodwill calculation and for the entry in equity.

    I'm assuming there is share premium or some other form of equity, as otherwise the fraction is horrible (Forth would own 7,000 / 10,260 share capital) which would be very unusual for this sort of question. Is that in the question somewhere?

    Secondly, what exactly does the question want you to calculate? There's nowhere near enough information there for a full SoFP.

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