Sarah is the finance director of Donnata plc and has recently prepared the draft consolidated financial statements of the Donnata group for the year ended 31 December 2019. You are currently the financial controller of Donnata plc and the managing director has informed you that he is concerned about Sarah's accounting treatment for goodwill, particularly given that her bonus is linked to the earnings per share. You have been provided with the following information: 1. On 1 January 2019 Donnata plc acquired 300,000 of the 400,000 1 shares in Lonergan Limited. The consideration comprised 200,000 of the 1 shares in Donnata plc issued on 1 January 2019. In addition, cash of 750,000 was paid at that date and further cash of 294,000 was due to be paid on 1 January 2020. Sarah has calculated the goodwill, based on the proportionate net assets method, at 99,150 and included this amount as an intangible asset in the consolidated financial statements. However, you have subsequently found out that Sarah has only included the cash consideration of 750,000 in her calculation. 2. On reviewing the board minutes you ascertain that goodwill and non-controlling interest are to be calculated using the fair value method. The fair value of noncontrolling interest at 1 Jaunary 2019 amounted to 230,000. 3. Lonergan Limited's financial statements for the year ended 30 June 2019 show profit for the year of 491,200 and retained earnings of 713,400. These financial statements include a note concerning a contingent liability in respect of ongoing legal proceedings against Lonergan Limited. The proceedings had commenced on 18 December 2018. The contingent liability had a fair value of 150,000 on 1 January 2019. Sarah made no adjustment for this liability when she calculated goodwill arguing that it did not form part of Lonergan Limited's net assets at the date of acquisition. 4. The market value of Donnata plc's shares on the 1 January 2019 was 2.40. You should assume a cost of capital of 5%.

Requirement (i) As per the requirements of IFRS 3, Business Combinations, calculate the goodwill arising on the acquisition of Lonergan Limited using the fair value method.

(ii) Calculate the non-controlling interest as at 30 June 2019 using the fair value method and explain, briefly, how the deferred consideration should be accounted for.