Question 1

Jack and Jill AB granted 200 options on its ordinary shares of no par value to each of its 800 employees on 1 January 2011. Each grant is conditional upon the employee being employed by Jack and Jill AB until 31 December 2013.

Jack and Jill AB estimated at 1 January 2011 that:

1. The fair value of each option was GH4.00 (before adjustment for the possibility of forfeiture).
2. Approximately 50 employees would leave during the 2011, 40 during 2012 and 30 during 2013 thereby forfeiting their rights to receive the options. The departures were expected to be evenly spread within each year.

The exercise price of the options wasGH1.50 and the market value of a Jack and Jill AB share on 1January2011 was GH3.00

In the event, only 40 employees left during 2011 (and the estimate of total departures was revised down to 95 at 31 December 2011), 20 during 2012 (and the estimate of total departures was revised to 70 at 31 December 2012) and none during 2013, spread evenly during the year.

Required:

The directors Jack and Jill AB have asked you to illustrate how the scheme is accounted for under IFRS2 Share-based payment. (10 Marks)

Question 2

(a) The statement of financial position of three companies as at 31 December 2017 showed the following position.

	Accra Ltd GHC	Tema Ltd GHC	Kumasi Ltd GHC
Non-Current Assets
Property Plant & Equipment	420,000	410,000	400,000
Investment	480,000	150,000	-
	900,000	560,000	400,000
Current asset
Inventory	150,000	120,000	100,000
Trade receivables	200,000	150,000	130,000
Bank balances	100,000	50,000	20,000
	450,000	320,000	250,000
Total Asset	1,350,000	880,000	650,000
Equity and Liability
Stated Capital
Ordinary Shares (atGHC1 each)	500,000	200,000	100,000
Preference Shares (at GHC1 each)	200,000	150.000	20,000
Income Surplus	150,000	100,000	80,000
Capital Surplus	230,000	80,000	50,000
	1,080,000	530,000	250,000
Non Current Liabilities
30% Bonds	100,000	120,000	50,000
Current Liability
Trade Payable	100,000	150,000	300,000
Income Tax	70,000	80,000	50,000
Total Equity and Liability	1,350,000	880,000	650,000

Additional information

1. On 1 April 2014, Accra purchased GH30,000 loan notes in Tema at par. Accra Ltd acquired 160,000 shares in Tema Ltd at GHC2 per share on 1st January 2014, when the income surplus and capital surplus balances of Tema Ltd were GHC60,000 and GHC40,000 respectively. The fair value of non-controlling interest of Tema Ltd at the date of acquisition was GHC125,000.

2. Accra Ltd acquired 60,000 shares in Kumasi Ltd on 31st December 2014 for GHC130,000, when the income surplus balance was GHC30,000. There has been no movement in the capital surplus accounts since acquisition.

3. On 31 December 2014 Tema Ltd acquired 20,000 shares in Kumasi Ltd for GHC50,000.

4. The fair value of non-controlling interest of Kumasi Ltd on 31 December 2014 was GHC85,000.

5. During the year Accra Ltd sold a motor vehicle to Tema Ltd costing GHC20,000 of which Accra Ltd made a profit of 25% on cost. The policy of the group is to depreciate its motor vehicles at 20% on cost.

Required:

Prepare the consolidated statement of financial position as at 31 December 2017 for Accra Ltd and its subsidiaries in accordance with the relevant IFRS. (20marks)