Sbr (int/UK) Strategic Business Reporting

S BR  (IN T & U K) :  S TRA TE G IC  BU SINES S  RE POR TI N G 

6 

K A P LAN   P UB LI S HI NG 

• 

the sale must be expected to be completed by 30 November 20X8 

• 

management is committed to a plan to dispose of Jam and that it is 

unlikely that there would be any significant changes to the plan. (1 mark) 

Jam is planning to continue to supply electricity to its existing customers, 

which may suggest that the assets are not available for immediate sale. 

 

  

(1 mark) 

However, it would appear usual and customary for Jam to continue to supply 

its customers until the sale takes place. A failure to do so would impact on the 

reputation of Jam and the valuation of the company.  

(1 mark) 

The regulatory approval may extend the sales period beyond 30 November 

20X8, placing doubt on whether a sale is highly probable in twelve months. 

 

  

(1 mark) 

However, the criteria for the sale to be completed within 12 months is relaxed 

if regulatory approval cannot be sought until after a firm purchase 

commitment is obtained.  

(1 mark) 

Beth is confident that a purchaser will be found shortly after the year end so it 

appears that the directors did correctly classify Jam as held for sale at 

30 November 20X7.