Consolidated Accounts – Income Statements

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Consolidated Accounts – Income Statements Unit 7 June 2013 Dr Vidya kumar

Consolidation adjustments The retained earnings of the subsidiary brought forward is divided into pre-acquisition profits and post-acquisition profits The group share of pre-acquisition profits are used in the goodwill calculation The share of the Post acquisition profits are brought into the consolidated shareholders' equity June 2013 Dr Vidya kumar

Consolidation adjustments Revenue and cost of sales are adjusted in order to eliminate intra-group sales and unrealised profits Finance expenses and income are adjusted to eliminate intra-group payments of interest and dividends June 2013 Dr Vidya kumar

Consolidation adjustments The non-controlling interest in the profit after tax of the subsidiary is deducted to arrive at the profit for the year attributable to the equity holders of the parent June 2013 Dr Vidya kumar

Consolidation adjustments The amounts paid as dividends to the parent company's shareholders are shown as deductions in the consolidated statement of changes in equity. June 2013 Dr Vidya kumar

Consolidation adjustments If a subsidiary is acquired during a financial year the items in its statement of comprehensive income require apportioning. June 2013 Dr Vidya kumar

Consolidation adjustments The important consideration is that the group accounts should only be credited with profits arising whilst the subsidiary was under the parent's control. June 2013 Dr Vidya kumar

Consolidation adjustments The important consideration is that the group accounts should only be credited with profits arising whilst the subsidiary was under the parent's control. June 2013 Dr Vidya kumar

Q & A June 2013 Dr Vidya kumar