(Increase in holding, no change in status, and an associate)

The following trial balances have been extracted from the financial records of the relevant companies for the year ended 31 December 20.8:

Retained earnings

	Wayne Limited	Jiyane Limited	Carol Limited
	R	R	R
Property, plant and equipment	593 000	302 500	223 600
Investment in Jiyane Limited at fair value
80 000 ordinary shares	209 250
Investment in Carol Limited at fair value 30 000 ordinary shares		60 000
Dividends paid 30 April 20.8		20 000
Dividends paid 30 December 20.8			10 000
Income tax expense	83 491	27 840	40 600
Trade receivables	53 159	35 610	46 700

Cash and cash equivalents	12 500	22 890	76 200
Share capital 300 000 ordinary shares	(300 000)
Share capital 150 000 ordinary shares		(175 000)
Share capital 100 000 ordinary shares			(100 000)
Retained earnings 1 January 20.8	(293 900)	(151 500)	(22 000)
Profit before dividend income	(287 900)	(96 000)	(140 000)
Dividends received	(16 000)	(3 000)
Long-term liability			(91 000)
Trade and other payables	(53 600)	(43 340)	(44 100)

Additional information

1. Wayne Limited acquired 80 000 ordinary shares in Jiyane Limited on 1 January 20.3 On this date Jiyane Limiteds share capital was R100 000 (100 000 shares) and the retained earnings was R55 000.
2. Jiyane Limited acquired 30 000 ordinary shares in Carol Limited on 1 October 20.8. Jiyane Limited exercises significant influence over the financial and operating policies of Carol Limited. The profit for the current year was earned evenly throughout the year.
3. At both the above acquisition dates there were no unidentified assets, liabilities or contingent liabilities and the fair values of all assets, liabilities and contingent liabilities were confirmed to be equal to the carrying amounts thereof. On 1 May 20.8 Jiyane Limited had a rights issue of 1 ordinary share for every 2 shares held at R1,50 per share. The parent took up 47 500 of the shares and the non-controlling shareholders took up the balance.
4. The fair value of available-for-sale financial assets is equal to the cost price thereof, unless otherwise stated.
5. The SA Normal tax rate is 29% and for all the entities, each share carries one vote.
6. It is the accounting policy of the group to measure non-controlling interest using the partial goodwill method.
7. At the end of the current year goodwill was assessed for impairment and it was not considered to be impaired.

(a) Prepare the consolidated financial statements of the Wayne Limited Group for theyear ended 31 December 20.8. (b) Prepare the pro forma consolidation journals for the Wayne Limited Group for the yearended 31 December 20.8. Journal narrations are required. Notes to the financial statements are not required. Your answer must comply with the requirements of Generally Accepted AccountingPractice. All calculations must be done to the nearest Rand