Page 74 - 16. COMPILER QB - INDAS 103
P. 74
the Statement of Profit and Loss. As such, an amount of ₨.2,00,000 should be recognised in the
Statement of Profit and Loss.
Fair value of identifiable assets and liabilities
The fair value of identifiable net assets (as given in the question) ₨ 45,00,000.
Non-Controlling Interest
The management has decided to recognize NCI at its fair value, which is given in the question as Rs₨
5,00,000.
Re-measure previously held interests in case business combination is achieved in stages
In this case, the control has been acquired in stages i.e., before acquisition to control, P Limited exercised
significant influence over S Limited. As such, the previously held interest should be measured at fair value
and the difference between the fair value and the carrying amount as at the acquisition date should be
recognised in the Statement of Profit and Loss. As such, an amount of ₨ 10,00,000 (i.e. 18,00,000 –
8,00,000) will be recognised in the Statement of Profit and Loss.
Determination of goodwill or gain on bargain purchase
Goodwill should be calculated as follows: (Rs)
Total consideration 79,00,000
Recognised amount of any non-controlling interest 5,00,000
Less: Fair value of net identifiable assets (45,00,000)
Goodwill 39,00,000
Q31. (Jan. 21)
On 1st April 2017, A Limited acquired 80% of the share capital of S Limited. On acquisition date the share
capital and reserves of S Ltd. stood at Rs. 5,00,000 and Rs. 1,25,000 respectively. A Limited paid initial cash
consideration of Rs. 10,00,000. Additionally, A Limited issued 2,00,000 equity shares with a nominal value of
Rs. 1 per share at current market value of Rs. 1.80 per share.
It was also agreed that A Limited would pay a further sum of Rs. 5,00,000 after three years. A Limited's
cost of capital is 10%. The appropriate discount factor for Rs. 1 @ 10% receivable at the end of
1st year: 0.91
2nd year: 0.83
3rd year: 0.75
The shares and deferred consideration have not yet been recorded by A limited. Below are the Balance Sheet
of A Limited and S Limited as at 31st March, 2019:
A Limited (Rs. S Limited (Rs.
000) 000)
Non-current assets:
Property, plant & equipment 5,500 1,500
Investment in S Limited at cost 1,000
Current assets:
Inventory 550 100
16. 73