QUESTION THREE Black Plc has a number of subsidiaries, one of which, White Ltd., was acquired during the year ended 31 March 2010.

The draft consolidated financial statements for the year ended 31 March 2010 are as follows:

Consolidated Statement of Comprehensive Income of Black Plc for the year ended 31 March 2010

	KM's
operating profit	1890
loss on disposal of property plant andequipment	(85)
interst	(210)
	1595
share of profit in assocaites	110
profit on ordinary activities before taxation	1705
taxation	(410)
	1295
profit attributable to :
owners of black plc	985
non controlling interest	310
group profit	1295

Statements of Financial Position are as follows:

	black plc		white plc
consolidated at acquisition	at 31/3/2010	at 31/3/2009
	KM's	KM's	KM's
ASSETS
NON CURRENT ASSETS
property plant and equipment	2440	1400	460
intangiables	460	420	0
investment in associates	380	330	0
	3280	2150	460
CURRENT ASSETS
inventories	685	600	180
trade and other receivables	310	260	85
cash and cash equivalents	0	60	15
TOTAL ASSETS	4275	3070	740

EQUITY AND LIABILITIES
K1 ordinary shares	450	400	350
share premium	250	100	80
retained earnings	1595	810	210
	2295	1310	640
non contolling interest	250	210	0
	2545	1520	640
NON CURRENT LIABILITIES
long term loans	1100	1100	0
CURRENT LIABLILITIES
bank overdraft	80	0	0
trade payables	210	190	80
taxation	340	260	20
TOTAL EQUITY and LIABILITEIS	4275	3070	740

Additional information:

1. Black Plc acquired 80% of the ordinary shares of White Ltd on 1 July 2009 for K400 million in cash and issued 25 million K1 ordinary shares with a market value of K100 million. At the date of acquisition, White Ltds assets and liabilities were recorded at their fair value, with the exception of some plant which had a fair value of K100, 000 below its carrying value.

2. During the year, Black Plc made a further issue of ordinary shares, again, at a premium above nominal value.

3. The property, plant and equipment sold during the year had a carrying value of K140 million. Total depreciation charges for the year were K209 million.

REQUIRED:

Prepare a consolidated statement of cash flows in accordance with IAS 7 Statement of Cash Flows for the year ended 31 March 2010 using the indirect method.

20 Marks