Client 3 (BKL Group Ltd) Re. Presentation/Disclosure of Non-controlling interest BKL Ltd is preparing its consolidated financial statements for the year ended 30 June 2021. The directors are wondering how non-controlling interest will be disclosed in their consolidated financial reports. On 1 July 2020, BKL Ltd purchased 70% of the shares of Subsidiary Ltd for $160,000. At the acquisition date, Subsidiary Ltd had issued capital of $100,000 and retained earnings of $100,000. Note: Goodwill was calculated as $20,000 using a full goodwill method. During 2020/21 financial year, BKL Ltd and Subsidiary Ltd recorded profits of $100,000 and $50,000 respectively. BKL Ltd sold inventory with a cost of $5,000 to Subsidiary for $$9,000. 80% of this inventory was still on hand of Subsidiary on 30 June 2021. Subsidiary Ltd adapted a fair valuation method and increased its Land value by $15,000. On 30 June 2021, both BKL Ltd and Subsidiary Ltd declared dividend of $10,000. The directors at BKL asked for your help with completing the consolidated financial statements. How should non-controlling interest be recorded on financial statements? Help the director to identify all affected financial statements and sections of the financial statements with non-controlling interest amounts. Provide advice to the director, with relevant references to the Australian Accounting standards in your answer.

Client 3 (BKL Group Ltd) Re. Presentation/Disclosure of Non-controlling interest BKL Ltd is preparing its consolidated financial statements for the year ended 30 June 2021. The directors are wondering how non-controlling interest will be disclosed in their consolidated financial reports. On 1 July 2020, BKL Ltd purchased 70% of the shares of Subsidiary Ltd for $160,000. At the acquisition date, Subsidiary Ltd had issued capital of $100,000 and retained earnings of $100,000. Note: Goodwill was calculated as $20,000 using a full goodwill method. During 2020/21 financial year, BKL Ltd and Subsidiary Ltd recorded profits of $100,000 and $50,000 respectively. BKL Ltd sold inventory with a cost of $5,000 to Subsidiary for $$9,000. 80% of this inventory was still on hand of Subsidiary on 30 June 2021. Subsidiary Ltd adapted a fair valuation method and increased its Land value by $15,000. On 30 June 2021, both BKL Ltd and Subsidiary Ltd declared dividend of $10,000. The directors at BKL asked for your help with completing the consolidated financial statements. How should non-controlling interest be recorded on financial statements? Help the director to identify all affected financial statements and sections of the financial statements with non-controlling interest amounts. Provide advice to the director, with relevant references to the Australian Accounting standards in your