On 1 April 2022, Kembang Berhad sold its 80% shareholding in Weelon Berhad for RM630,000. This disposal constituted a discontinued operation. On 31 December 2022, Weelon Berhad had retained earnings of RM176,500, including a profit for the year ended 31 December 2022 of RM75,500. Weelon Berhad has 200,000 RM1 ordinary shares in issue which has not changed since incorporation.

Kembang Berhad acquired its 80% shareholding in Weelon Berhad on 1 January 2015 for RM575,000. Weelon Berhads retained earnings at that date were RM74,300. On the acquisition date, the fair value of the assets acquired and liabilities assumed by Kembang Berhad were equal to their carrying amounts.

Kembang Berhad measures non-controlling interests and goodwill using the proportionate method.

At the date of disposal, Kembang Berhad had recognised cumulative impairment losses of RM28,500 in respect of goodwill arising on the acquisition of Weelon Berhad.

Requirements

a) Calculate profit for the year from discontinued operations for inclusion in Kembang Berhads consolidated statement of profit or loss for the year ended 31 December 2022. (4 marks)

b) Describe any differences between IFRS Standards and UK GAAP in respect of the financial reporting treatment of the disposal of Weelon Berhad. (3 marks)