CONSOLIDATED FINANCIAL STATEMENTS
DATE OF ACQUISITION
Total assets of parent
Total assets of subsidiary
Investment in subsidiary
Fair value adjustments - net
Goodwill – net*
Effect of intercompany transactions
Consolidated total assets
Share capital of parent
Share premium of parent
Consolidated retained earnings
Equity attributable to owners of the parent
Non-controlling interests
Consolidated total equity
XX
XX
(XX)
XX
XX
XX
XX
Total Liabilities of Parent
Contingent Consideration (if Asset)
Total Liabilities of Parent (at Fair Value)
Consolidated total Liabilities
XX
XX
XX
XX
XX
XX
XX
XX
XX
XX
SUBSEQUENT TO THE DATE OF ACQUISITION / INTERCOMPANY TRANSACTIONS
Step 1: Analysis of effects of intercompany transaction
Ending inventory of Parent Co.
Ending inventory of Subsidiary Co.
Less: Unrealized profit in ending inventory
Consolidated ending inventory
xx
xx
xx
xx
Sales by Parent Co.
Sales by Subsidiary Co.
Less: Intercompany sales
Consolidated sales
Cost of sales of Parent Co.
Cost of sales of Subsidiary Co.
Less: Intercompany sales during 2017
Add: Unrealized profit in ending inventory
Add: Depreciation of FVA on inventory
Consolidated cost of sales
xx
xx
xx
xx
xx
xx
Equipment, net – Parent
Equipment, net – Subsidiary
Unamortized balance of deferred loss*
FVA on equipment, net
Consolidated equipment – net
xx
xx
xx
xx
xx
Step 2: Analysis of net assets
Subsidiary Co.
Acquisition
date
Consolidation
date
Net
change
Net assets at carrying amounts
Fair value adjustments at acquisition date
Subsequent depreciation of FVA
Unrealized profit (Upstream)
Unamortized def. loss (Upstream)
Interest income
Subsidiary's net assets at fair value
Step 3: Goodwill computation
Consideration transferred
Previously held equity interest in the acquiree
Total
Less: Parent's proportionate share in the net assets of subsidiary
xx
xx
xx
xx
xx
xx
xx
Goodwill attributable to owners of parent
Less: Parent’s share in goodwill impairment
Goodwill attributable to owners of parent
xx
xx
Fair value of NCI (see given)
Less: NCI's proportionate share in the net assets of subsidiary
Goodwill attributable to NCI
Less: NCI’s share in goodwill impairment
Goodwill attributable to NCI
xx
xx
xx
Step 4: Non-controlling interest in net assets
Subsidiary's net assets at fair value
Multiply by: NCI percentage
Total
Add: Goodwill to NCI net of accumulated impairment
Non-controlling interest in net assets
xx
xx
xx
xx
xx
Step 5: Consolidated retained earnings
Parent's retained earnings – Dec. 31, 2017
Consolidation adjustments:
Parent's share in the net change in Subsidiary's net assets
Unrealized profits (Downstream only)
Loss on extinguishment of bonds
Intercompany interest expense
Parent’s share in goodwill impairment
Net consolidation adjustments
Consolidated retained earnings
Step 6: Consolidated profit or loss
Parent
xx
xx
xx
xx
xx
(xx)
xx
xx
Subsidiary
Consolidated
Profits before adjustments
Consolidation adjustments:
Unrealized profits
Unamortized def. loss
Loss on bonds
Interest exp./income
Dividend income
Net consolidation adjustments
Profits before FVA
Depreciation of FVA
Impairment of goodwill
Consolidated profit
Step 7: Profit or loss attributable to owners of parent and NCI
Owners of
parent
Parent's profit before FVA - (Step 6)
Share in Subsidiary’s profit before FVA (c)
Depreciation of FVA - (Step 6)
Impairment of goodwill - (Step 6)
Totals
NCI
Consolidated