Search found 23 matches

by yvonne
06 May 2022, 05:50
Forum: IFRS-related topics
Topic: Investment in associate - Impairment?
Replies: 5
Views: 1204

Re: Investment in associate - Impairment?

Is it being closed because it was a failure and has no value left, or perhaps for other reasons and you'll get a return of capital when it is closed down greater than your investment? Hi JRSB, it's expected by my management that my company will not get any return/proceeds/cash flows back upon volun...
by yvonne
04 May 2022, 09:03
Forum: IFRS-related topics
Topic: Investment in associate - Impairment?
Replies: 5
Views: 1204

Investment in associate - Impairment?

Hi everyone, would like to seek your advice on the case below: All the investors have decided to close down an investee (recorded as an Associate in my book) voluntarily in the next financial year. Is this considered as an impairment indicator for the investment in associate in the current financial...
by yvonne
11 Apr 2022, 18:27
Forum: IFRS-related topics
Topic: Goodwill calculation
Replies: 10
Views: 3223

Re: Goodwill calculation

Marek Muc wrote: 11 Apr 2022, 18:09 I agree we would have a gain of $14

does this correspond to a real-life scenario?
Yeah sort of, it's a startup. That somehow puzzled me :?
by yvonne
11 Apr 2022, 18:23
Forum: IFRS-related topics
Topic: Goodwill calculation
Replies: 10
Views: 3223

Re: Goodwill calculation

Leo wrote: 11 Apr 2022, 14:51 Yes, I do believe so. Please anyone correct me if I'm wrong.

the gain is calculated by the following :

Consideration paid : 70
Net assets purchased : 120(50+70)*0.7=-84

Bargain : 14 in P&L
Yup thanks, I got your points.
by yvonne
11 Apr 2022, 14:49
Forum: IFRS-related topics
Topic: Goodwill calculation
Replies: 10
Views: 3223

Re: Goodwill calculation

Hi Leo, thanks a lot for your illustration! So effectively there's a gain on bargain purchase of $14 recognised in consolidated P&L?
by yvonne
11 Apr 2022, 14:45
Forum: IFRS-related topics
Topic: Goodwill calculation
Replies: 10
Views: 3223

Re: Goodwill calculation

the 70 will be going to the previous owner so it's not in S's net assets anyway, before or after Hmm as mentioned S will issue new shares to P and give P a 70% shareholding. P is not buying any shares from the previous owner, nor paying them. To account for the share issue, I suppose the cash consi...
by yvonne
11 Apr 2022, 08:48
Forum: IFRS-related topics
Topic: Goodwill calculation
Replies: 10
Views: 3223

Goodwill calculation

Hi everyone! would appreciate your kind advice on the case below: Company S's current financials: Net assets 50 Total equity 50 - Share capital 30 ($1 per ordinary share) - Retained earning 20 Company S will be issuing 70 new ordinary shares to Company P for a total cash consideration $70. As a resu...
by yvonne
08 May 2021, 18:03
Forum: IFRS-related topics
Topic: Equity transactions of Associates
Replies: 1
Views: 956

Re: Equity transactions of Associates

Sorry guys, I'm getting lost and I think my example above is confusing. Please allow me to edit my example and questions. A holds a 100% interest in B and B holds a 60% interest in C (a subsidiary of B). On 1 Sep 2020, there's a share swap arrangement in which B issued new shares for $2m (to C's NCI...
by yvonne
07 May 2021, 20:58
Forum: IFRS-related topics
Topic: Equity transactions of Associates
Replies: 1
Views: 956

Equity transactions of Associates

A holds a 100% interest in B and B holds a 60% interest in C (a subsidiary of B). On 1 Sep 2020, there's a share swap arrangement in which B issued new shares for $2m (to C's NCI) to acquire the remaining 40% interest in C. As a result of the share swap, A's holding in B dropped from 100% to 40% (be...
by yvonne
07 May 2021, 04:44
Forum: General accounting and financial reporting discussion
Topic: Partial Disposal of Subsidiary (to Associate)
Replies: 5
Views: 6705

Re: Partial Disposal of Subsidiary (to Associate)

Thank you very much Marek. after reading it halfway through, I think i won't apply this advanced valuation :lol: Btw about the computation of the "carrying value of investment retained", what do you advise? One more question here, do you think can we apply Purchase Price Allocation method ...
by yvonne
06 May 2021, 19:24
Forum: General accounting and financial reporting discussion
Topic: Partial Disposal of Subsidiary (to Associate)
Replies: 5
Views: 6705

Re: Partial Disposal of Subsidiary (to Associate)

(2) I see. So we take the value of new share issued as fair value ;)
What if it's not on market terms?
by yvonne
06 May 2021, 11:02
Forum: General accounting and financial reporting discussion
Topic: Partial Disposal of Subsidiary (to Associate)
Replies: 5
Views: 6705

Partial Disposal of Subsidiary (to Associate)

Hi everyone! Would appreciate very much if anyone could shed some light on the case below: A acquired 100% of B (total 40 shares) for $50k in 2019. Say on 1 Sep 2020, B issued another 60 shares for $80k to a third party, making its total number of shares become 100. As such, A's shareholding in B ha...
by yvonne
06 May 2021, 07:13
Forum: General accounting and financial reporting discussion
Topic: Joint Venture - Indirect Holding
Replies: 9
Views: 5813

Re: Joint Venture - Indirect Holding

JRSB wrote: 04 May 2021, 20:00 From memory this company has something similar, See note 9 of accs. JV with further subs (also with NCI etc)...

https://find-and-update.company-informa ... ng-history
Thanks! It helps my FS disclosure
by yvonne
30 Apr 2021, 18:28
Forum: General accounting and financial reporting discussion
Topic: Joint Venture - Indirect Holding
Replies: 9
Views: 5813

Re: Joint Venture - Indirect Holding

Thanks Marek! I think I have more confidence to deal with this JV now :D
by yvonne
30 Apr 2021, 17:23
Forum: General accounting and financial reporting discussion
Topic: Joint Venture - Indirect Holding
Replies: 9
Views: 5813

Re: Joint Venture - Indirect Holding

As far as I understand, basically the carrying amount of investment in Joint Venture = investment cost in X + A's share of post-acquisition profit/OCI of X group?
by yvonne
30 Apr 2021, 05:25
Forum: General accounting and financial reporting discussion
Topic: Joint Venture - Indirect Holding
Replies: 9
Views: 5813

Re: Joint Venture - Indirect Holding

Thanks Marek.

So in A's Consolidated Balance Sheet, it will have Investment in Joint Ventures (X,Y and Z) and share 49% of post-acquisition change in their (X,Y and Z) net assets, right?
by yvonne
29 Apr 2021, 13:02
Forum: General accounting and financial reporting discussion
Topic: Joint Venture - Indirect Holding
Replies: 9
Views: 5813

Joint Venture - Indirect Holding

Hi all, I would like to ask your professional advices on this issue: - A has a 49% share in a joint venture, X. - X has 2 100%-owned subsidiaries, Y and Z. In X's perspective, I understand that X needs to consolidate its subsidiaries, Y and Z. In A's perspective, A will account for X using equity me...
by yvonne
23 Jun 2020, 17:38
Forum: IFRS-related topics
Topic: Joint Venture - Share allotment
Replies: 11
Views: 2333

Re: Joint Venture - Share allotment

Yeah, this is hard one. One could also look at this transaction as follows: A and B received 500k 'for free' which they contributed to JV I guess it's crucial to understand the economics behind the arrangement- can you please shed more light yvonne? Sure, probably can think that A and B contribute ...
by yvonne
23 Jun 2020, 17:06
Forum: IFRS-related topics
Topic: Joint Venture - Share allotment
Replies: 11
Views: 2333

Re: Joint Venture - Share allotment

JRSB wrote: 23 Jun 2020, 13:29 So C paid $1.5m for a 1/3 share worth $500,000?
Yes, basically C acts like a pure investor while A and B are involved in managing and running the JV, entity D.
by yvonne
23 Jun 2020, 11:17
Forum: IFRS-related topics
Topic: Joint Venture - Share allotment
Replies: 11
Views: 2333

Re: Joint Venture - Share allotment

I just come across the paragraph below when reading IAS 28: https://www.iasplus.com/en/standards/ias/ias28-2011 Initial accounting. An investment is accounted for using the equity method from the date on which it becomes an associate or a joint venture. On acquisition, any difference between the cos...
by yvonne
23 Jun 2020, 10:28
Forum: IFRS-related topics
Topic: Joint Venture - Share allotment
Replies: 11
Views: 2333

Re: Joint Venture - Share allotment

Alright, let me look into the JV agreement in detail. Your advice is very helpful! Thank you. :D
by yvonne
23 Jun 2020, 09:20
Forum: IFRS-related topics
Topic: Joint Venture - Share allotment
Replies: 11
Views: 2333

Re: Joint Venture - Share allotment

Thanks for the response!

So for entity A, even though it has received 500,000 shares, this transaction is to be recognised at nil value? :D
Or should I recognise the difference $500,000 as other income in P&L, treated like "negative goodwill"?
by yvonne
23 Jun 2020, 06:25
Forum: IFRS-related topics
Topic: Joint Venture - Share allotment
Replies: 11
Views: 2333

Joint Venture - Share allotment

Hi everyone, Company A, B and C have come into a JV agreement and set up a JV, Company D. There're several milestones to be completed in this JV and each completed milestone will trigger issue of new shares by Company D. Upon completion of the first milestone, Company D will allot and issue shares t...