On 1 January 20X6, Parent Co acquired 80% of Subsidiary Cos equity shares by means of a share exchange of two shares in Parent Co for every four Subsidiary Co shares acquired. On that date, further consideration was also issued to the shareholders of Subsidiary Co in the form of a $120 8% loan note for every 80 shares acquired in Subsidiary Co. None of the purchase consideration, nor the outstanding interest on the loan notes at 31 March 20X6, has yet been recorded by Parent Co. At the date of acquisition, the share price of Parent Co and Subsidiary Co is $ 5 and $3 respectively

Prepare the consolidated statement of financial position for Parent Co as at 31 March 20X6?

The summarised statements of financial position of the two companies as at 31 March 20x6 are: Parent Co Subsidiary Co $'000 S'000 Non-current assets Property, plant and equipment (note (1) 75,200 31,500 Investment in Alpha Co at 1 April 20x5 (note (iv)) 4,500 Current assets Inventory (note (111) 19,400 18,800 Trade receivables (note (tid)) 14,700 12,500 Bank 600 1,200 Total assets 115,000 63,400 Equity shares of $1 each Retained earnings - at 1 April 20x5 for year ended 31 March 20x6 Non-current liabilities 8% loan notes Current liabilities (note (111) 50,000 19,000 17,000 20,000 20,000 7,000 5,000 24,000 16,400 Total equity and liabilities 115,000 63,400 The following information is relevant At the date of acquisition, the fair values of Subsidiary Co's assets were equal to their carrying amounts. However, Subsidiary Co. operates a mine which requires to be decommissioned in five years' time. No provision has been made for these decommissioning costs by Subsidiary Co. The present value (discounted at 8%) of the decommissioning is estimated at $4m and will be paid three years from the date of acquisition (the end of the mine's life). ii. Parent Co's policy is to value the non-controlling interest at fair value at the date of acquisition. Subsidiary Co's share price at that date can be deemed to be representative of the fair value of the shares held by the non-controlling interest. iii. The inventory of Subsidiary Co includes goods bought from Parent Co for $3-Im. Parent Co applies a consistent margin on of 25% when arriving at its selling prices. On 29 March 20X6, Parent Co dispatched goods to Subsidiary Co with a selling price of $500,000. These were not received by Subsidiary Co until after the year end and so have not been included in the above inventory at 31 March 20X6. At 31 March 20X6, Parent Co's records showed a receivable due from Subsidiary Co of $2m, this differed to the equivalent payable in Subsidiary Co's records due to the goods in transit. The intra- group reconciliation should be achieved by assuming that Subsidiary Co had received the goods in transit before the year end. iv. The investment in Alpha Co represents 40% of its voting share capital and Parent Co uses equity accounting to account for this investment. Alpha Co's profit for the year ended 31 March 20X6 was $5m. V. All profits and losses accrued evenly throughout the year. Vi. An impairment review shows that Goodwill has been impaired by $lm year ended 31 March 20x6. The summarised statements of financial position of the two companies as at 31 March 20x6 are: Parent Co Subsidiary Co $'000 S'000 Non-current assets Property, plant and equipment (note (1) 75,200 31,500 Investment in Alpha Co at 1 April 20x5 (note (iv)) 4,500 Current assets Inventory (note (111) 19,400 18,800 Trade receivables (note (tid)) 14,700 12,500 Bank 600 1,200 Total assets 115,000 63,400 Equity shares of $1 each Retained earnings - at 1 April 20x5 for year ended 31 March 20x6 Non-current liabilities 8% loan notes Current liabilities (note (111) 50,000 19,000 17,000 20,000 20,000 7,000 5,000 24,000 16,400 Total equity and liabilities 115,000 63,400 The following information is relevant At the date of acquisition, the fair values of Subsidiary Co's assets were equal to their carrying amounts. However, Subsidiary Co. operates a mine which requires to be decommissioned in five years' time. No provision has been made for these decommissioning costs by Subsidiary Co. The present value (discounted at 8%) of the decommissioning is estimated at $4m and will be paid three years from the date of acquisition (the end of the mine's life). ii. Parent Co's policy is to value the non-controlling interest at fair value at the date of acquisition. Subsidiary Co's share price at that date can be deemed to be representative of the fair value of the shares held by the non-controlling interest. iii. The inventory of Subsidiary Co includes goods bought from Parent Co for $3-Im. Parent Co applies a consistent margin on of 25% when arriving at its selling prices. On 29 March 20X6, Parent Co dispatched goods to Subsidiary Co with a selling price of $500,000. These were not received by Subsidiary Co until after the year end and so have not been included in the above inventory at 31 March 20X6. At 31 March 20X6, Parent Co's records showed a receivable due from Subsidiary Co of $2m, this differed to the equivalent payable in Subsidiary Co's records due to the goods in transit. The intra- group reconciliation should be achieved by assuming that Subsidiary Co had received the goods in transit before the year end. iv. The investment in Alpha Co represents 40% of its voting share capital and Parent Co uses equity accounting to account for this investment. Alpha Co's profit for the year ended 31 March 20X6 was $5m. V. All profits and losses accrued evenly throughout the year. Vi. An impairment review shows that Goodwill has been impaired by $lm year ended 31 March 20x6