1 Groups and consolidation: an overview

 
431 
P GROUP
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 
$
$
Assets
Non-current assets 
Tangible non-current assets (50,000 + 35,000) 
85,000 
Goodwill (W1) 
30,000 
115,000 
Current assets (45,000 + 40,000) 
85,000 
Total assets
200,000 
$
$
 
Equity and liabilities
Equity attributable to owners of the parent 
Share capital (P Co only) 
80,000 
Retained earnings (W2) 
62,500 
142,500 
NCI (W3) 
 
 17,500 
Total equity
160,000 
Current liabilities (20,000 + 20,000) 
40,000 
Total equity and liabilities 
 
 
200,000 
Workings 
1 
Goodwill
$ 
$
Fair value of consideration transferred 
60,000 
Plus fair value of NCI at acquisition 
15,000 
Less net acquisition-date fair value of identifiable assets acquired 
and liabilities assumed: 
Ordinary share capital 
40,000 
Retained earnings at acquisition 
5,000 
(45,000) 
Goodwill 
30,000 
2 
Retained earnings
 P Co 
 S Co 
$
$ 
Per question 
55,000 
15,000 
Pre-acquisition retained earnings 
(5,000) 
10,000 
Group share of post-acq ret'd earnings: 
S Co (75% 

10,000) 
7,500 
Group retained earnings 
62,500 
3 
NCI at reporting date 
$
Fair value of NCI at acquisition 
15,000 
Plus NCI's share of post-acquisition retained earnings (25% 

10,000) 
2,500 
NCI at reporting date 
17,500 
QUESTION 
Goodwill
 
On 31 December 20X8 Pandora Co acquired 4m of the 5m $1 ordinary shares of Sylvester Co, paying 
$10m cash. On that date the fair value of Sylvester's net assets was $7.5m. 
The market price of the shares held by the non-controlling shareholders just before the acquisition was 
$2.00. What is goodwill in the consolidated statement of financial position? 
$'000 
A 2,000 
B 2,500 
C 4,000 
D 4,500 
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