Please consider the below scenario:
Parent A owned 100% equity share in its Subsidiary.
In the book of the Parent, investment in Subsidiary was USD 100,000.
Parent has disposed its Subsidiary for USD 150,000. Therefore, a gain of USD 50,000 has been recognized in P&L of the Parent.
Share Capital of the Subsidiary is USD 100,000
Retained earnings is USD 5,000.
Profit for the period is Nil.
There's no goodwill.
Please advise on the accounting treatments in the consolidated SOPL and SOFP?
Disposal of Subsidiary
Re: Disposal of Subsidiary
Did you set up the subsidiary from scratch. If not what was the retained earnings at acquisition.
Re: Disposal of Subsidiary
What do you mean by SOLP and SOFP?
Thanks
Thanks
Re: Disposal of Subsidiary
Subsidiary set up from scratch
Sopl - st of profit or loss
Sofp - st of Financial position
Sopl - st of profit or loss
Sofp - st of Financial position
Re: Disposal of Subsidiary
it doesn't matter what the amounts are in standalone accounts of the parent
in consolidated FS, you need to derecognise all assets and liabilities (incl. goodwill, fair value adjustments etc)
https://ifrscommunity.com/knowledge-bas ... of-control
in your case it seems that the gain will be 150 k (price) less 95 k (net assets disposed)
in consolidated FS, you need to derecognise all assets and liabilities (incl. goodwill, fair value adjustments etc)
https://ifrscommunity.com/knowledge-bas ... of-control
in your case it seems that the gain will be 150 k (price) less 95 k (net assets disposed)