Understanding Australian Accounting Standards 3E - Loftus - SMch27_sm_loftus

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1、SolutionsManualtoaccompanyUnderstandingAustralianAccountingStandardsJaniceLoftus,KenLeo,RuthPicker,VictoriaWise,KerryClarkByKenLeoJohnWiley&SonsAustralia,Ltd2013Chapter27:CFS:Non-controllinginterestsChapter27:CFS:Non-controllinginterestsComprehensionques

2、tions1.Whatismeantbytheterm‘non-controllinginterest’(NCI)?NCIisthetermusedfortheownershipinterestinasubsidiaryotherthantheparent.ItisdefinedinAASB127as:Theequityinasubsidiarynotattributable,directlyorindirectly,toaparent.2.ExplainwhethertheNCIisbettercla

3、ssifiedasdebtorequity.ThemainargumentfortheNCIbeingclassifiedasequityisthatitbetterfitsthedefinitionofequity.ThesubsidiaryhasnopresentobligationinrelationtheNCIsotheNCIdoesnotmeetthedefinitionofaliability.SomewritersarguethatNCIshouldbedisclosedsepara.te

4、lyfromequityanliabilities–the“mezzanine”treatment.Thisargumentrelatestotheutilityoffinancialstatementsinrelationtotheusergroup,theparentshareholders.Itisarguedthatthisformofpresentationprovidesmorerelevantinformationtotheparentshareholders.3.Explainwheth

5、ertheNCIisentitledtoashareofsubsidiaryequityorsomeotheramount.IftheNCIisclassifiedasequity,itisentitledtoashareofconsolidatedequity.Notethatconsolidatedequityisbasicallysubsidiaryequityadjustedfortheeffectsofintragrouptransactions–thatis,realisedsubsidia

6、ryequity.IfitwereclassifiedasaliabilityofthesubsidiarythenthecalculationoftheNCIwouldbebasedontheobligationheldbythesubsidiary.4.HowdoestheexistenceofanNCIaffectthebusinesscombinationvaluationentries?Thereisnoeffect.Howeverifthefullgoodwillmethodisused,t

7、herecognitionofthesubsidiary’sgoodwillismadeviaaBCVRentry.Incontrast,wherethepartialgoodwillmethodisused,goodwillisrecognisedinthepre-acquisitionentry.Why?TheBCVRentries,apartfromthatforgoodwill,arepreparedbecauseoftherequirementofAASB3toshowtheidentifia

8、bleassetsandliabilitiesoftheacquireeatfairvalue.Thedeterminationoffairvalueisnotaffectedbytheparent’sownershipinthesubsidiary.©JohnWileyandSonsAustraliaLtd201327.83Chapter27:CFS:Non-controllinginterests1.Howdoestheexistenc