Reference no: EM13558054

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

Below are the statements of profit or loss and other comprehensive income of Tyson, its subsidiary Douglas and associate Frank at 31 December 20X8. Tyson, Douglas and Frank are public limited companies.

	Tyson	Douglas	Frank
	$m	$m	$m
Revenue	500	150	70
Cost of sales	(270)	(80)	(30)
Gross profit	230	70	40
Other expenses	(150)	(20)	(15)
Finance income	15	10	-
Finance costs	(20)	-	(10)
Profit before tax	75	60	15
Income tax expense	(25)	(15)	(5)
PROFIT FOR THE YEAR	50	45	10
Other comprehensive income:
Gains on property revaluation, net of tax	20	10	5
TOTAL COMPREHENSIVE INCOME FOR THE YEAR	70	55	15

You are also given the following information:

1) Tyson acquired 80m shares in Douglas for $188m three years ago when Douglas had a credit balance on its reserves of $40m. Douglas has 100m $1 ordinary shares.

2) Tyson acquired 40m shares in Frank for $60m two years ago when that company had a credit balance on its reserves of $20m. Frank has 100m $1 ordinary shares.

3) During the year Douglas sold some goods to Tyson for $66m (cost $48m). None of the goods had been sold by the year end.

4) Group policy is to measure non-controlling interests at acquisition at fair value. The fair value of the noncontrolling interests in Douglas at acquisition was $40m. An impairment test carried out at the year end resulted in $15m of the recognised goodwill relating to Douglas being written off and recognition of impairment losses of $2.4m relating to the investment in Frank.

Required

Prepare the consolidated statement of profit or loss and other comprehensive income for the year ended 31 December 20X8 for Tyson, incorporating its associate.

PROFORMA SOLUTION TYSON GROUP - CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 20X8
	$m
Revenue
Cost of sales
Gross profit
Other expenses
Finance income
Finance costs
Share of profit of associate
Profit before tax
Income tax expense
PROFIT FOR THE YEAR
Other comprehensive income:
Gains on property revaluation, net of tax
Share of other comprehensive income of associates
Other comprehensive income for the year, net of tax
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
Profit attributable to:
Owners of the parent
Non-controlling interests
Total comprehensive income attributable to:
Owners of the parent
Non-controlling interests

 

Workings
1) Group structure
2) Non-controlling interests
	PFY		TCI
	$m		$m
PFY/TCI per question
Unrealised profit (W3)
Impairment loss
x NCI share
3) Unrealised profit
		$m
Selling price
Cost
Provision for unrealised profit