QUESTION $1$

$25$ MARKS

Amos Ltd bought ordinary and preference shares in Strauss Ltd on $1$ January $2021$ when the

accumulated loss was N$$15000.$ The following are the abridged financial statements of Amos

Ltd and its subsidiary, Strauss Ltd as at $31$ December $2023.$

STATEMENTS OF FINANCIAL POSITION AS AT $31$ DECEMBER $2023$

Amos Ltd

N$

Assets

Property, plant and equipment

Investment in Strauss Ltd at Fair Value:

$80000$ ordinary shares $($Cost N$$80000)$

$700012\%$ preference shares $($Cost N$$14000)$

Inventories

Bank

Total assets

Equity and Liabilities

Ordinary share Capital $(200000/100000$ shares$)$

Preference share capital $(0/20000$ shares$)$

Retained earnings

Market to market reserve

$810000$

$100000$

$18000$

$120000$

$83000$

$1131000$

$600000-$

$450000$

$24000$

Strauss Ltd

N$

$380000$

$40000$

$35000$

$455000$

$100000$

$40000$

$229200$

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OLD CURRICULUM MODULES

Trade and other payables

Total equity and liabilities

$57000$

$1131000$

$85800$

$455000$

EXTRACT FROM THE STATEMENTS OF CHANGES IN EQUITY FOR THE YEAR ENDED

$31$ DECEMBER $2023$

Balance as at $1$ January $2023$

Profit for the year

Market to market reserve

Ordinary dividends paid

Preference dividend paid

Balance as at $31$ December $2023$

Additional information

Market

Retained earnings

Amos Ltd

market

Reserve

Strauss Ltd Amos Ltd

$295000$

$230000$

$(75000)-$

$450000$

$184000$

$60000$

$(10000)$

$(4800)$

$229200$

$20000$

$4000$

$24000$

to

$1.$ The preference shareholders have a preferential right to their dividends payment and

will receive a proportion pf the net assets available upon liquidation of the acquiree. The

fair value of the non$-$controlling preference share at acquisition date was N$$30000.$

$2.$ Amos Ltd elected to measure any non$-$controlling interests in an acquire at its

proportionate share of the acquiree$$s identifiable net assets at acquisition date.

$3.$ Assume that all assets and liabilities of Strauss Ltd were fairly valued at acquisition

except for the building that was overvalued by N$$20000.$ At that stage, Amos Ltd also

confirmed the remaining useful life of $5$ years. Depreciation on building is provided at

$10\%$ per annum according to the straight$-$line method.

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OLD CURRICULUM MODULES

$4.$ Since $1$ January $2023,$ Amos Ltd acquired all its inventory strictly from Strauss Ltd at

cost plus $25\%.$ The total sales for the current year amounted to N$$650000.$

$5.$ Amos Ltd classified the equity investment in Strauss Ltd under IFRS $9$ in its separate

financial statements and recognised fair value adjustments in a mark$-$to$-$market reserve

$($other comprehensive income$).$ The fair values of Amos Ltd$$s investment in Strauss Ltd

at $31$ December $2022$ were as follows:

Investment in ordinary shares N$$97000$

Investment in preference shares N$$17000$

$6.$ Ignore tax.

REQUIRED

Prepare all the consolidated journals required for the consolidated

financial statements of Amos Group for $31$ December $2023$ financial year.

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MARKS

$25$

QUESTION $2$

$10$ MARKS

The following is the segment information in respect of Jumbo Ltd$,$ a wholesaler listed on the

Namibian Stock Exchange with a chain of outlets across Namibia:

Operating Segments $($N$ $000)$

Branch

Sales to customers

Windhoek

$80000$

Inter$-$segment sales $10000$

Expenses

Assets

$50000$

$120000$

Oshakati

$50000-$

$40000$

$95000$

Divundu

$30000$

$2000$

$35000$

$40000$

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OLD CURRICULUM MODULES

The following items must still be accounted for:

$$ Interest paid of N$$10$ million $($in the ratio $2$:$2$:$1)$

REQUIRED

a$)$ Define an operating segment in accordance with IFRS $8.$

b$)$ Determine the reportable operating segments in accordance with the

requirements of IFRS $8$ using only the $$profit$/$loss threshold$.$

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