You are the financial director of Dawn Ltd $($Dawn$),$ the parent company of the Dawn group. All companies within the group$$s reporting date is $31$ December.

Extract of the trial balances as at $31$ December $2023$ of the group$$s companies listed below:

dawn Ltd Horizon Ltd

Share capital, at N$ $68$ for each share $(680000000)$

Share capital, at N$ $70$ for each share $(350000000)$

Retained earnings, $1$ January $2023(7300000)(2100000)$

General reserve $(24500000)(15000000)$

Investment in $3000000$ shares ofHorizon at cost $210000000-$

Property, plant and equipment $207900000126500000$

Other investments $10450000014000000$

Inventory $154000000160000000$

Accounts receivable $150000000155000000$

Bank $(10000000)7500000$

Accounts payable $(41000000)(15500000)$

Long term liabilities $(44400000)(74000000)$

Revenue $???(230000000)$

Cost of sales $300000000???$

Expenses $7175000048100000$

Income tax expense $90500003000000$

Profit before tax for the year $(28250000)(9400000)$

Extract of Retained Earnings in the statement of changes in equity for the year ending $31$ December $2023$ of the group$$s companies listed below:

Dawn Ltd Horizon Ltd

Retained earning Retained earning

Balance $-1$ January $202373000002100000$

Profit for the year $192000006400000$

Transfer to general reserve $(4500000)(2500000)$

Dividends declared $(12000000)-$

Balance $-31$ December $2023100000006000000$

Additional Information

$$ Dawn acquired its shareholding in Horizon Ltd $($Horizon$)$ on $30$ June $2020$ when the general reserve and the retained earnings were N$$2000000$ and N$$1500000$ respectively.

$$ Assume that the identifiable assets and liabilities acquired at acquisition date are shown at their acquisition$-$date fair values, as determined in terms of IFRS $3,$ Business combinations. Dawn elected to measure any non$-$controlling interests in Horizon at its proportional share of Horizon$$s identifiable net assets at acquisition date.

$$ Dawn classifies the equity investments in Horizon at cost in accordance with IFRS $9,$ Financial instruments.

$$ Revenue is calculated on a gross profit percentage of $25\%.$

$$ Expenses includes:

o Depreciation on the property, plant and equipment which is calculated using the $10\%$ per year diminishing value method. Depreciation is classified as an administrative expense.

o Finance costs on the long term loans of N$ $4440000$ and N$ $5920000$ for the parent and subsidiary respectively.

o The remaining costs are other expenses.

$$ You should use the income tax figures indicated above and don$$t have to recalculate the income tax expense.

Required

a$)$ Prepare all the pro$-$forma consolidation journal entries to incorporate Horizon $($Pty$)$ Ltd into the Dawn Ltd group for the year ended $31$ December $2023.$ Journal narrations are not required. $(15)$

b$)$ Prepare a Statement of profit or loss and other comprehensive income for the year ended $31$ December $2023$ of the Dawn group in accordance with IFRS. One $(1)$ mark will be allocated for Presentation Skill. Notes and comparative figures are not required. The revenue, cost of sales, gross profit and different income and various expense items needs

to be clearly indicated on the Statement of profit or loss and other comprehensive income for the year.