On $1$ July $2022$ Maswe Ltd had a number of subsidiary companies. Extracts from the group$$s

consolidated financial statements for the year ended $30$ June $2023$ are set out below.

Consolidated statement of profit or loss for the year ended $30$ June $2023($extract$)$

Continuing operations P

Profit from operations $1,201,560$

Finance costs $(12,500)$

Profit before tax $1,189,060$

Income tax expense $(238,000)$

Profit for the year from continuing operations $951,060$

Discontinued operations

Profit for the year from discontinued operations $45,350$

Profit for the year $996,410$

Attributable to:

Owners of Maswe Ltd $805,200$

Non$-$controlling interest $191,210$

$996,410$

Consolidated statement of financial position as at $30$ June

$2023$

$2022$

ASSETS P P

Non$-$current assets $2,235,3001,965,600$

Current assets

Inventories $1,052,300903,200$

Trade and other receivables $603,800562,200$

Cash and cash equivalents $83,60062,200$

$1,739,7001,527,600$

Total assets $3,975,0003,493,200$

EQUITY AND LIABILITIES

Equity

Ordinary share capital $($P$1$ shares$)600,000500,000$

Share premium account $40,000100,000$

Revaluation surplus $850,600509,200$

Retained earnings $957,800934,900$

Attributable to the equity holders of Maswe Ltd $2,448,4002,044,100$

Non$-$controlling interest $506,200615,900$

$2,954,6002,660,000$

Non$-$current liabilities

Finance lease liabilities $250,600190,500$

Current liabilities

Trade and other payables $499,500405,200$

Q P $-$ A S R $-001|$ R e v $001$ E f f D a t e : $09-0$

$8-2023$

Page $6$ of $6$

Finance lease liabilities $40,30039,500$

Income tax payable $230,000198,000$

$769,800642,700$

Total equity and liabilities $3,975,0003,493,200$

Additional information:

$1)$ On $1$ January $2023$ Maswe Ltd sold all of its $80\%$ holding in Magano Ltd for cash of P$619,900.$ Goodwill

arising on this acquisition was calculated correctly at P$79,800,$ using the proportionate method, although

impairments of P$30,000$ had been recognised by $30$ June $2022.$ The profit from discontinued operations in the

consolidated statement of profit or loss relates wholly to the sale of the shares in Magano Ltd and can be

analysed as follows:

P

Profit before tax $52,350$

Income tax expense $(10,500)$

Profit on disposal $3,500$

$45,350$

The net assets of Magano Ltd at the date of disposal were as follows:

P

Property, plant and equipment $692,200$

Trade and other receivables $48,300$

Cash and cash equivalents $650$

Trade and other payables $(32,900)$

$708,250$

$2)$ Non$-$current assets comprised of property, plant and equipment and goodwill which had arisen on

business combinations. The following is relevant to the movements of non$-$current assets during the

year ending $30$ June $2023$:

$$ The only movement on goodwill was with regards to the disposal of Magano Ltd$.$

$$ A depreciation charge of P$495300$ was recognised during the year.

$$ Other than the sale of Magano Ltd$,$ there were no other land, plant, or equipment disposals.

$$ The group entered into finance leases for assets with a cash price of P$342000.$ All finance costs

relate to finance leases.

$$ On $1$ July $2022$ Maswe Ltd revalued a plot of land. On the same date a building in a different

location, which cost Maswe Ltd P$750000$ on $1$ July $2000,$ was also revalued to P$816,000.$ The

building was being depreciated over a useful life of $50$ years.

$$ In line with best practice, a transfer was made between the revaluation surplus and retained

earnings.

$3)$ During the year ended $30$ June $2023$ ordinary dividends were paid to both the shareholders of Maswe

Ltd and to the non$-$controlling interest. Maswe Ltd also made an issue of shares for cash and a bonus

issue of ordinary shares out of share premium.

Requirement: Prepare a consolidated statement of cash flows for Maswe Ltd for the fiscal year ended

$30$ June $2023,$ using the indirect method of reconciling profit before tax to cash generated from

operations. $[25$ marks$]$