Company X

Fixed Assets
Tangible assets
Investment subnsidiary
Current Assets
Stocks
Debtors
Cash at bank and in hand

Creditors: amounts falling

due within one year
Net Current Assets
Total Assets Less Current
Liabilities
Creditors: amounts falling due
after more than one year
Accruals and deferred income
Net Assets
Capital and Reserves
Called up share capital
Called up share capital A shares
Called up share capital B shares
Profit and loss account
Equity Shareholders' Funds

Company Y

2,040,147
1

2,854,279

1,239,231
3,634,440
2,512,859
_______
7,386,530

1,766,480
3,797,210
2,357,943
_______
7,921,633

(4,546,241)
_______

(6,557,190)
_______
2,840,289
_______

1,364,443
_______

4,880,437

4,218,722

(512,219)
_______
4,368,217
_______

(876,202)
(51,554)
_______
3,290,966
_______

364,710

4,003,507
_______
4,368,217
_______

583684
1
2,707,281
_______
3,290,966
_______

The B share has the right to appoint the majority of the directors in company Y but no
other rights. Company X purchased the share when the retained earnings of Y were
270,000. There is a loan from x to y amounting to 2,000,000 (dr in X, cr in Y)

Consolidation Calculation
Goodwill
Paid
Received
Goodwill

1
Nil
1 which is written off to miscellaneous.

Retained earnings
Holding company retained earnings plus group share of post acquisition retained
earnings in subsidiary:
Group
Post acquisition R/E in sub
Group share
Consolidated balance sheet

Minority interest
Company Y is worth
Minority share is
Minority interest is

4,003,507
2437281
0%

Nil
4,003,507

(2,707,281 270,000)
(The B share does not share in profits)

3,290,966
100%
3,290,966

Consolidation
Fixed Assets
Tangible assets (2,040,147 + 2,854,279)
Current Assets
Stocks (1,239,231+1,766,480)
Debtors (3,634,440+3,797,210-2,000,000)
Cash at bank and in hand (2,512,859+2,357,943)

4,894,425
3,005,711
5,431,650
4,870,802
_______ _______
13,308,163

Creditors: amounts falling

due within one year (4,546,241 + 6,557,190-2m)

(9,103,431)
_______

Net Current Assets

4,204,732
_______

Total Assets Less Current

Liabilities
Creditors: amounts falling due
after more than one year 512,219+876,202
Accruals and deferred income 51554
Minority Interest
Net Assets
Capital and Reserves
Called up share capital
Profit and loss account (write off the 1 goodwill)
Equity Shareholders' Funds

9,099,157

(1,388,421)
(51,554)
(3,290,966)
_______
4,368,216
_______

364,710
4,003,506
_______
4,368,216