The additional 20% purchase by RBE results is enhancing in the controlling interest held in the subsidiary, DCA. No additional goodwill is calculated on the additional purchase as goodwill is only calculated at the date control was gained in accordance with IFRS 3. However, at the date of the further purchase (1 October 2010) the value of NCI needs to be established. The proportion "sold" will be transferred from NCI to parent's equity within the SOCIE. The difference between that value and the consideration transferred is included in parent's equity as an "adjustment to parent equity" on acquisition.
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Statement of changes in equity for the year ended 31 December 2010 Attributable to equity holders of the parent
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Non-controlling interest
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Total
Equity
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|
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$000
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$000
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$000
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Balance at the start of the year
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3,350
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650
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4,000
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TCI for the year (W1)
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1,350
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150
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1,500
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Share issue (2m x $1.30)
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2,600
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2,600
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Dividends
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(200)
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(30) (W2)
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(230)
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Adjustment to NCI for additional purchase of DCA shares (W3)
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(503)
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Adjustment to parent's equity
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(37) (W3)
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-
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(37)
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Balance at the end of the year
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7,063
|
267
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7,833
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Working 1
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$000
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NCI share of total comprehensive income of DCA $600,000:
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NCI at 30% x $600,000 x 9/12 months
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135
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NCI at 10% x $600,000 x 3/12 months
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15
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NCI share of TCI
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150
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Therefore parent share of TCI of DCA is $600,000 - $150,000 = $450,000.
Total TCI attributable to equity holders of parent is $900,000 +$450,000 = $1,350,000.
Working 2
NCI share of dividend paid April 2010 by DCA = 30% x $100,000 = $30,000.
Working 3
Value of NCI at 1 October 2010 is $650,000+$135,000(W1)-$30,000(W2) = $755,000
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Therefore the value transferred is $755,000 x 2/3 = $503,333 Adjustment to parent's equity
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$000
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Consideration transferred
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540
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Value of non-controlling interest transferred
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(503)
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Adjustment to parent equity
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37
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