Additional information:

The fair value of land owned by Cryo ltd was 3m in excess of the carrying value in

Cryos statement of financial position at the date of acquisition.

At acquisition the brand value of Hydro ltd was estimated to be 600,000 and deemed

to have an indefinite useful life.

At 30 June 2022 goodwill relating to the acquisition of Cryo is considered impaired by

20%.

Inter-group sales from Dendro plc to Hydro ltd were 5m during the year ending 30

June 2022 with a net margin of 15%. At 30 June 2022 2m of inter-group sales (at the

selling price from Dendro plc to Hydro ltd) were still in Hydro ltds inventory.6

Continued Overleaf

No dividends were paid during the year by any of the companies and their share capital

remained unchanged since 1 July 2021.

Non-controlling interests in any subsidiaries are to be measured at the appropriate

proportion of the subsidiaries identifiable net assets.

Required:

1. Explain the nature of the relationship between Dendro plc, Cryo ltd, Hydro ltd and

Pyro ltd, and the associated accounting treatment, referring to relevant IFRS.

2. Prepare the consolidated statement of financial position for the Dendro plc group as

at 30 June 2022.

Dendro plc acquired 60% of Cryo Itd and 80% of Hydro Itd and 30% of Pyro Itd on 1 July 2021. Summary financial statements for each company are shown below. Additional information: - The fair value of land owned by Cryo Itd was 3m in excess of the carrying value in Cryo's statement of financial position at the date of acquisition. - At acquisition the brand value of Hydro Itd was estimated to be 600,000 and deemed to have an indefinite useful life. - At 30 June 2022 goodwill relating to the acquisition of Cryo is considered impaired by 20%. - Inter-group sales from Dendro plc to Hydro Itd were 5m during the year ending 30 June 2022 with a net margin of 15%. At 30 June 20222m of inter-group sales (at the selling price from Dendro plc to Hydro Itd) were still in Hydro Itd's inventory. - No dividends were paid during the year by any of the companies and their share capital remained unchanged since 1 July 2021. - Non-controlling interests in any subsidiaries are to be measured at the appropriate proportion of the subsidiaries' identifiable net assets. Required: 1. Explain the nature of the relationship between Dendro plc, Cryo Itd, Hydro Itd and Pyro Itd, and the associated accounting treatment, referring to relevant IFRS. 2. Prepare the consolidated statement of financial position for the Dendro plc group as at 30 June 2022 . Dendro plc acquired 60% of Cryo Itd and 80% of Hydro Itd and 30% of Pyro Itd on 1 July 2021. Summary financial statements for each company are shown below. Additional information: - The fair value of land owned by Cryo Itd was 3m in excess of the carrying value in Cryo's statement of financial position at the date of acquisition. - At acquisition the brand value of Hydro Itd was estimated to be 600,000 and deemed to have an indefinite useful life. - At 30 June 2022 goodwill relating to the acquisition of Cryo is considered impaired by 20%. - Inter-group sales from Dendro plc to Hydro Itd were 5m during the year ending 30 June 2022 with a net margin of 15%. At 30 June 20222m of inter-group sales (at the selling price from Dendro plc to Hydro Itd) were still in Hydro Itd's inventory. - No dividends were paid during the year by any of the companies and their share capital remained unchanged since 1 July 2021. - Non-controlling interests in any subsidiaries are to be measured at the appropriate proportion of the subsidiaries' identifiable net assets. Required: 1. Explain the nature of the relationship between Dendro plc, Cryo Itd, Hydro Itd and Pyro Itd, and the associated accounting treatment, referring to relevant IFRS. 2. Prepare the consolidated statement of financial position for the Dendro plc group as at 30 June 2022