Subject: Advanced corporate reporting

Topic: Complex and Associate Consolidation

Question 3 Below are the financial statements of four entities for the year ended 319 December 2020. Statements of Financial Position as at 31st December 2020 Peony Silence Scabiosa Anthurium RM'm RM'm RM'm RM'm Non-current assets Property, plant and equipment 26,360 13,150 5,005 1,900 Financial investments 17,550 4.800 43,910 17,950 5,005 1,900 Current assets Inventories 8,980 6,050 1,750 545 Trade and other receivables 1,811 2,000 1.148 894 Cash and cash equivalent 1750 1.149 1035 760 12,541 9,199 3,933 2,199 56,451 27,149 8,938 4,099 4,700 1,500 Equity Ordinary shares (@ RM1) Share premium Retained earnings 29,900 7,700 11,530 49,130 13,200 2.200 4,650 20,050 2,050 6,750 1320 2.820 Non-Current liabilities 10% Loan notes 2,200 2,400 Current liabilities Bank Trade and other payables Income tax 2,130 101 3,750 1.270 5,121 403 3,891 405 4,699 58 2.188 1.260 19 1,279 56,451 27,149 8,938 4,099 The following information is available: (1) Peony acquired 10,560 million shares in Silence on 9 March 2017 for RM 15,964 million when Silence Plc's retained earnings were RM 3,700 million. (1) Silence acquired 3,525 million shares in Scabiosa on 1 October 2018 for RM 5,000 million when retained earnings of Scabiosa were RM 1,740 million. (1) Peony acquired 450 million shares in Anthurium on 1 April 2017, when the reserves of Anthurium were RM 1,200 million. The purchase consideration was RM 820 million. Since the acquisition Peony has a representative on Anthurium's board of directors. (11) When Peony acquired its shareholding in Silence, a specialist company valued the property, plant, and equipment of Silence exceeded its book value by RM 480 million. At the date of acquisition, the property, plant, and equipment had a remaining useful life of 30 years. Silence's accounting policy is to depreciate the assets using straight line basis. A full depreciation is charged for assets held at year end. (11) The fair value of the net assets of Scabiosa and Anthurium were equal to the carrying values. (iv) During the year, Silence sold goods to Peony for RM 600 million at a mark-up of 25%. 70% of the goods have been sold out. (v) Accounts payable of Silence includes RM 100 million due to Peony. The accounts receivable of Peony includes RM 240 million due from Silence. The difference is due to a payment in transit made by Silence to Peony. (vi) Peony decided to impair goodwill of Silence by 5% and charged it to administration expenses. There is no impairment of goodwill in Scabosia and Anthurium Required: Prepare the consolidated statement of financial position for the Peony Group for the year ending 31* December 2020 Question 3 Below are the financial statements of four entities for the year ended 319 December 2020. Statements of Financial Position as at 31st December 2020 Peony Silence Scabiosa Anthurium RM'm RM'm RM'm RM'm Non-current assets Property, plant and equipment 26,360 13,150 5,005 1,900 Financial investments 17,550 4.800 43,910 17,950 5,005 1,900 Current assets Inventories 8,980 6,050 1,750 545 Trade and other receivables 1,811 2,000 1.148 894 Cash and cash equivalent 1750 1.149 1035 760 12,541 9,199 3,933 2,199 56,451 27,149 8,938 4,099 4,700 1,500 Equity Ordinary shares (@ RM1) Share premium Retained earnings 29,900 7,700 11,530 49,130 13,200 2.200 4,650 20,050 2,050 6,750 1320 2.820 Non-Current liabilities 10% Loan notes 2,200 2,400 Current liabilities Bank Trade and other payables Income tax 2,130 101 3,750 1.270 5,121 403 3,891 405 4,699 58 2.188 1.260 19 1,279 56,451 27,149 8,938 4,099 The following information is available: (1) Peony acquired 10,560 million shares in Silence on 9 March 2017 for RM 15,964 million when Silence Plc's retained earnings were RM 3,700 million. (1) Silence acquired 3,525 million shares in Scabiosa on 1 October 2018 for RM 5,000 million when retained earnings of Scabiosa were RM 1,740 million. (1) Peony acquired 450 million shares in Anthurium on 1 April 2017, when the reserves of Anthurium were RM 1,200 million. The purchase consideration was RM 820 million. Since the acquisition Peony has a representative on Anthurium's board of directors. (11) When Peony acquired its shareholding in Silence, a specialist company valued the property, plant, and equipment of Silence exceeded its book value by RM 480 million. At the date of acquisition, the property, plant, and equipment had a remaining useful life of 30 years. Silence's accounting policy is to depreciate the assets using straight line basis. A full depreciation is charged for assets held at year end. (11) The fair value of the net assets of Scabiosa and Anthurium were equal to the carrying values. (iv) During the year, Silence sold goods to Peony for RM 600 million at a mark-up of 25%. 70% of the goods have been sold out. (v) Accounts payable of Silence includes RM 100 million due to Peony. The accounts receivable of Peony includes RM 240 million due from Silence. The difference is due to a payment in transit made by Silence to Peony. (vi) Peony decided to impair goodwill of Silence by 5% and charged it to administration expenses. There is no impairment of goodwill in Scabosia and Anthurium Required: Prepare the consolidated statement of financial position for the Peony Group for the year ending 31* December 2020