The statements of financial position of Paran, Saran and Aran as at 31 March 2017 are given below. All three companies are private limited liability companies. Paran Saran Aran Rs. million Rs. million Rs. million Assets Non-current assets Property 10,000 6,000 2,500 Plant and machinery 4,000 2.000 1,500 Investments 7.500 21.500 8.000 4.000 Current assets Inventories 3.000 1,500 1,500 Trade receivables 1.650 1,500 1.850 Cash and cash equivalents 350 1.000 150 5.000 4.000 3.500 Total assets 26.500 12.000 7,500 Equity and liabilities Equity Stated capital Retained earnings 10.000 7.800 17.800 5.000 4.750 9.750 3.750 2.250 6.000 Non-current liabilities 10% Bank Loan 2.500 500 Current liabilities Trade payables Borrowings 1,750 1,500 3,400 2.800 6.200 26,500 Total equity and liabilities 1.750 12.000 1.500 7.500 Additional information () Paran acquired 3 million out of the 5 million ordinary shares in Saran on 1 April 2015 for immediate cash consideration of Rs. 4.000 million and further Rs. 1,210 million to be paid on 1 April 2017. Paran's cost of capital is 10 %. However, payment to be made on 1 April 2017 has not yet been recorded in the books of accounts of Paran. At the date of acquisition, the retained earnings of Saran were Rs. 1,000 million. There has been no change to the stated capital of Saran since 1 April 2015. (ii) At the date of acquisition of Saran, the fair value of its property was considered to be Rs. 2,000 million greater than its value stated in Saran's statement of financial position. Saran had acquired the property in April 2001 and the building element (comprising 50% of the total value) is depreciated on cost over 54 years from the date of acquisition of the property (ii) Saran has an internally developed brand name which was valued at Rs. 150 million at the date of acquisition and deemed to have a 15 years useful life. This has not been included in the fair value of the net assets. (iv) The non-controlling interest of Saran at the acquisition date is measured at fair value and it was estimated to be Rs. 3,200 million. It is group policy to measure the non-controlling interest at fair value. (w) On 1 April 2016 Paran sold a machine to Saran for Rs.200 million. The Carrying value of this machine on the date of transfer was Rs. 150 million. The remaining useful life of the machine on the date of disposal was 5 year. (vi) Paran acquired 1,125,000 of the 3,750,000 ordinary shares in Aran on 1 April 2015 for Rs. 3,500 million when the retained earnings of Aran were Rs. 750 million. (vii) Saran manufactures a component used by Paran. Transfers are made by Saran at cost plus 25%. Paran held Rs. 500 million worth of inventory of these components as at 31 March 2017 (viii) During the year Paran sold goods to Aran of which Aran had Rs. 400 million worth of goods at 31 March 2017. Paran had marked these goods up by 25%. (ix) The goodwill in Saran is 50% impaired and should be written off. (x) An impairment loss of Rs. 460 million is to be recognised on the investment in Aran. Required: a) Compute the goodwill arising on the acquisition of Saran in the consolidated financial statements of Paran (Pvt) Ltd. b) Prepare the consolidated statement of financial position of Paran group as at 31 March 2017. The statements of financial position of Paran, Saran and Aran as at 31 March 2017 are given below. All three companies are private limited liability companies. Paran Saran Aran Rs. million Rs. million Rs. million Assets Non-current assets Property 10,000 6,000 2,500 Plant and machinery 4,000 2.000 1,500 Investments 7.500 21.500 8.000 4.000 Current assets Inventories 3.000 1,500 1,500 Trade receivables 1.650 1,500 1.850 Cash and cash equivalents 350 1.000 150 5.000 4.000 3.500 Total assets 26.500 12.000 7,500 Equity and liabilities Equity Stated capital Retained earnings 10.000 7.800 17.800 5.000 4.750 9.750 3.750 2.250 6.000 Non-current liabilities 10% Bank Loan 2.500 500 Current liabilities Trade payables Borrowings 1,750 1,500 3,400 2.800 6.200 26,500 Total equity and liabilities 1.750 12.000 1.500 7.500 Additional information () Paran acquired 3 million out of the 5 million ordinary shares in Saran on 1 April 2015 for immediate cash consideration of Rs. 4.000 million and further Rs. 1,210 million to be paid on 1 April 2017. Paran's cost of capital is 10 %. However, payment to be made on 1 April 2017 has not yet been recorded in the books of accounts of Paran. At the date of acquisition, the retained earnings of Saran were Rs. 1,000 million. There has been no change to the stated capital of Saran since 1 April 2015. (ii) At the date of acquisition of Saran, the fair value of its property was considered to be Rs. 2,000 million greater than its value stated in Saran's statement of financial position. Saran had acquired the property in April 2001 and the building element (comprising 50% of the total value) is depreciated on cost over 54 years from the date of acquisition of the property (ii) Saran has an internally developed brand name which was valued at Rs. 150 million at the date of acquisition and deemed to have a 15 years useful life. This has not been included in the fair value of the net assets. (iv) The non-controlling interest of Saran at the acquisition date is measured at fair value and it was estimated to be Rs. 3,200 million. It is group policy to measure the non-controlling interest at fair value. (w) On 1 April 2016 Paran sold a machine to Saran for Rs.200 million. The Carrying value of this machine on the date of transfer was Rs. 150 million. The remaining useful life of the machine on the date of disposal was 5 year. (vi) Paran acquired 1,125,000 of the 3,750,000 ordinary shares in Aran on 1 April 2015 for Rs. 3,500 million when the retained earnings of Aran were Rs. 750 million. (vii) Saran manufactures a component used by Paran. Transfers are made by Saran at cost plus 25%. Paran held Rs. 500 million worth of inventory of these components as at 31 March 2017 (viii) During the year Paran sold goods to Aran of which Aran had Rs. 400 million worth of goods at 31 March 2017. Paran had marked these goods up by 25%. (ix) The goodwill in Saran is 50% impaired and should be written off. (x) An impairment loss of Rs. 460 million is to be recognised on the investment in Aran. Required: a) Compute the goodwill arising on the acquisition of Saran in the consolidated financial statements of Paran (Pvt) Ltd. b) Prepare the consolidated statement of financial position of Paran group as at 31 March 2017