合并報表會計-合并各方間交易課件

1

Consolidation21

Consolidation22Theneedforadjustments AASB127:2typesofadjustmentsareneeded: (i)thesubstitutioneliminationentry(eliminating“SharesinSLtd”) (ii)entriesthateliminatetheeffectsof inter-entitytransactionssuchas-inter-entityservices,saleofinventoryanddepreciableassetsinter-entityborrowingsinter-entitydividends2Theneedforadjustments AASB3TheneedforadjustmentsThepurposeofconsolidatefinancialstatementsistoprovideinformationofdealingswithexternalpartiesonly.Hencetheeffectsofthetransactionswithinthegroupmustbeadjusted.AASB127para24“Intragroupbalances,transactions,incomeandexpensesshallbeeliminated.”3TheneedforadjustmentsThep4TheneedforadjustmentsAASB127para26Thefinancialstatementsoftheparentanditssubsidiariesshallbepreparedasofthesamereportingdate.Whendifferentthesubsidiarymustprepareadditionalfinancialstatementsasofthesamedateastheparent.4TheneedforadjustmentsAASB15Theneedforadjustments

Anyprofitsmadeoninter-entitytransactionsmustbeeliminatedbecause,fromagroupviewpoint,theyareunrealisedprofits.Eachgroupassetmustbeshownatitscosttothegroup(whichmaybedifferenttothecostrecordedbytheentitywithinthegroupthatcurrentlyownstheasset).5Theneedforadjustments6Theneedforadjustments

EachgroupliabilitymustrepresentanobligationtoanentityoutsidethegroupWemayhavetoadjustfortheeffectsofpriorperiodtransactionsaswellascurrentperiodtransactions.Thisisbecauseconsolidationadjustmententriesareappliedinaworksheetonlyandnotintheaccountsofeithertheparentoranyofitssubsidiaries.6Theneedforadjustments7TheneedforadjustmentsWhenitemsofstockaresoldwithinthegroup(e.g.PtoS,orStoP)anyprofitmadeonthesalemustbeeliminated.Theunrealisedprofitsontheseinternalsaleswilldistortstocklevelsindollarterms.Wewilleliminatetheseunrealisedprofitsbymeansofadjustmentstoopeningandclosingstockamounts.7TheneedforadjustmentsWhen8TheneedforadjustmentsUnrealisedprofitsoninternalsalesbecomerealisedgroupprofitsifandwhentheitemthatwassoldinternallypassestoabuyeroutsidethegroup.Whenthisoccursthegroupwillrecordsalesrevenueandthecosttothegroupofwhatwassold(COGS).8TheneedforadjustmentsUnrea9Example:PsoldanitemofstocktoSfor$100cash.Assumethatthissalewasatcost,sonoprofitwasrecognisedbyP.InthebooksofP: DrBank 100

CrSales* 100InthebooksofS:

DrPurchases* 100

CrBank 100*Groupeffect

Inventoryadjustments9Example:Psoldanitemofst10Inventoryadjustments

Thefinaleffectofthissalefromagroupviewpointis: DrPurchases 100 CrSales 100Toreversethiseffectandsoavoidoverstatinggroupsalesandpurchases: DrSales 100 CrPurchases 100Thisentryhasnoeffectongroupprofit.10Inventoryadjustments11Inventoryadjustments

Howisgrossprofitcalculated?ToreduceCr SALESREVENUE DrprofitDr-COGS Cr

profit

=GROSSPROFIT 11Inventoryadjustments12Inventoryadjustments

Howiscostofgoodssoldcalculated?

ToreduceDropeningstockCr

Dr+purchases CrCr-closingstockDrDr=costofgoodssoldCrReducingopeningstockincreasesprofitReducingclosingstockreducesprofit12Inventoryadjustments13InventoryadjustmentsAdjustmententriesmayaffectassetandliabilitybalancese.g.transferofinventoryataprofit.Wherecarryingamountsdifferfromtaxbase,tax-effectmustbeconsidered.Thelegalentity’srecordsconsiderthedifferencesbetweenthetaxbaseandthecarryingamountinthelegalentity.Onconsolidation,itisthechangeinthecarryingamountthataffectthisrelationshipandrequiresadjustment.13InventoryadjustmentsAdjustm14InventoryadjustmentsExample:IfSubLtdcarriesanassetat$100andthetaxbaseoftheassetis$80,SubLtdwillraiseadeferredtaxliabilityof30%x$20.Ifonconsolidationanadjustmentismadetoreducetheassetto$90,thecarryingamounttotheeconomicentity,thedeferredtaxliabilitymustbereducedby30%x$10.Combiningthelegalentities’recordsandtheconsolidationadjustmentresultsintheeconomicentity’spositionbeingshownintheconsolidatedfinancialstatements.14InventoryadjustmentsExample15InventoryadjustmentsAt1/7/00,ParentLtdsellsinventorytoSubLtdfor$1000ataprofitbeforetaxof$200.Taxrateis30%.Allinventoryisunsoldat30/6/01.RECORDEDPOSITIONParentLtd:

SubLtd:Salesof$1000 Inventoryat$1000Costofsalesof$800Profitof$200Incometaxexpenseof$6015InventoryadjustmentsAt1/7/16InventoryadjustmentsECONOMICENTITY

POSITION Nosalestoexternalparties Nocostofsalestoexternalparties Noprofitonsaleofinventoryto externalparties Costofinventoryat30/6/01is$80016InventoryadjustmentsECONOMI17InventoryadjustmentsCONSOLIDATIONWORKSHEETADJUSTMENTSales Dr 1000 CostofSales Cr 800 Inventory Cr 200DeferredTaxAsset Dr 60 IncomeTaxExpense Cr 60*Carryingamountofinventoryisreducedfrom$1000to$800.CA<TBby$200.(DTAof$200x0.3)17InventoryadjustmentsCONSOLI18InventoryadjustmentsAssumeallthetransferredinventoryissoldbySubLtdexternallyfor$1200by30/6/01.RECORDEDPOSITION

Parent

Sub TotalSales 1000 1200 2200Costofsales 800 1000 1800Profit 200 200 400Taxexpense 60 60 12018InventoryadjustmentsAssume19InventoryadjustmentsECONOMICENTITYPOSITIONSalesof$1200–toexternalpartyCostofsalesof$800–fromexternalpartyProfitof$400Taxexpenseof$120CONSOLIDATIONWORKSHEETADJUSTMENTSales Dr 1000 CostofSales Cr 100019InventoryadjustmentsECONOMI20InventoryadjustmentsAssumeat30/6/01thatSLtdhassold75%oftheinventoryexternallyfor$900.Thatisthereisendinginventorycontainingunrealisedprofitof$50i.e.25%x$200.RECORDEDPOSITION

Parent

Sub

TotalSales $1000 $900

$1900Costofsales800 750 1550Inventory - 250 25020InventoryadjustmentsAssume21InventoryadjustmentsECONOMICENTITYPOSITIONSales $900Costofsales 600 i.e.75%x$800Inventory 200 i.e.25%x$800CONSOLIDATIONWORKSHEETADJUSTMENTSales Dr 1000 CostofSales Cr 950 Inventory* Cr 50*Note:thisis25%xprofitof$200.Netresultistodecreasegroupprofitby$50.21InventoryadjustmentsECONOMI22InventoryadjustmentsAsinventoryisbeingreducedby$50,atax-effectentryisrequiredasCA<TBby$50:DeferredTaxAsset Dr 15 IncomeTaxExpense Cr 15Thedeferredtaxassetisreversedwhentheinventoryissoldexternally.22InventoryadjustmentsAsinve23InventoryadjustmentsAt1/7/01,inventorycontainingunrealisedprofitof$50remainsonhand.Intheconsolidationworksheetfor2001-02:RetainedProfits(1/7/01) Dr 35 IncomeTaxExpense** Dr 15 CostofSales* Cr 50SLtdrecordscostofsalesof$250,theeconomicentitywouldrecord$200.Resultisthatthisyear’sgroupprofitwillincreaseby$50beforetax.23InventoryadjustmentsAt1/7/24DepreciableassetsOn1/7/00,ParentLtdsellsplanttoSubLtdfor$1000.IthadacarryingamountinParentLtdof$800.Depreciationis10%p.a.RECORDEDPOSITION–Saleofasset

Parent

SubRevenue $1000 Plant $1000Carryingamountofassetsold $800 Incometaxexpense 6024DepreciableassetsOn1/7/00,25DepreciableassetsECONOMICENTITYPOSITIONNosalePlantheldatcostof$800CONSOLIDATIONWORKSHEETADJUSTMENTRevenue–Proceeds Dr 1000 CarryingAmount ofPlantSold Cr 800 Plant Cr 20025DepreciableassetsECONOMICE26DepreciableassetsAscarryingamountofassethasbeenreducedonconsolidationby$200,thenCA<TBorviewitasgroupprofitdecreasingby$200:DeferredTaxAsset Dr 60 IncomeTaxExpense Cr 60REALISATIONOFPROFITNoexternalpartyinvolvedProfitisrealisedasassetisconsumed–measuredbyreferencetodepreciation26DepreciableassetsAscarryin27DepreciableassetsDepreciation:SubLtddepreciatesplantat10%p.a.oncostof$1000i.e.$100Theeconomicentitychargesdepreciationat10%p.a.oncostof$800i.e$80CONSOLIDATIONWORKSHEETADJUSTMENTAccumulatedDepreciation Dr 20 DepreciationExpense Cr 20IncomeTaxExpense Dr 6 DeferredTaxAsset Cr 627DepreciableassetsDepreciati28DepreciableassetsSUBSEQUENT

PERIODS-ASASSETREMAINSONHANDCONSOLIDATION

WORKSHEET

ADJUSTMENTSALEOFASSETRetainedProfits(1/7/01) Dr 140DeferredTaxAsset Dr 60 Plant Cr 200Profitisstillconsideredtobeunrealised28DepreciableassetsSUBSEQUENT29DepreciableassetsAccumulatedDepreciation Dr 40 DepreciationExpense Cr 20 RetainedProfits(1/7/01) Cr 20IncomeTaxExpense Dr 6RetainedProfits(1/7/01) Dr 6 DeferredTaxAsset Cr 1229DepreciableassetsAccumulate30IntragroupservicesSomeexamplesofservicesbetweenrelatedentitiesincludeLendingofspecialistpersonnelforlimitedperiodsoftimeOneentitymayleaseorrentanitemofplantorwarehousefromtheotherAsubsidiarymayexistsolelyforthepurposeofcarryingoutsomespecifictask30IntragroupservicesSomeexam31IntragroupservicesSLtdpaid$30,000toPLtdfortheservicesofaspecialistemployeeInPLtdCash Dr 30,000 ServiceRevenue Cr 30,000InSLtdServiceExpense Dr 30,000 Cash Cr 30,000ConsolidationadjustmententryServicesRevenue Dr 30,000 ServicesExpense Cr 30,00031IntragroupservicesSLtdpai32IntragroupBorrowing

RECORDEDPOSITIONParentLtd

LoantoSLtd(asset) $1000Interestrevenue 70SubsidiaryLtdLoanfromPLtd(liability)$1000Interestexpense70At1/7/03PLtdlends$1000toSLtd.Interestpaidat30/6/04is$70.32IntragroupBorrowing33IntragroupBorrowingECONOMICENTITYPOSITIONNoloanasset,noloanliability,norevenue,noexpensebecausenoexternalpartywasinvolvedCONSOLIDATIONWORKSHEETADJUSTMENTSDrLoanfromPLtd 1000CrLoantoSLtd 1000DrInterestrevenue 70CrInterestexpense 70Notaxeffect33IntragroupBorrowingECONOMIC34IntragroupdividendsfrompostacquisitionprofitsFromagroupviewpointinternaldividendsaresimplytransfersofcashfromonepartofthegrouptoanother.“Post-acquisition”dividendsarethosepaidfromprofitsearnedafterPLtd’sacquisitionofSLtd.PwillneverpaydividendstoS.Why?BecauseScannotlegallyownsharesinitsownparentcompany.34Intragroupdividendsfrompo35Intragroupdividendsfrom

post-acquisitionprofitsDIVIDENDWASPAIDINCURRENTPERIODRECORDEDPOSITIONParentLtd

SubsidiaryLtdDividendrevenue $1000 Interimdiv. $1000ECONOMICENTITYPOSITIONNodividendwaspaidtoorreceivedfromanexternalpartyYLtdpaida$1000dividendtoXLtdon1/1/03.35Intragroupdividendsfrom

p36Intragroupdividendsfrom

post-acquisitionprofitsCONSOLIDATIONWORKSHEETDrDividendrevenue 1000CrInterimdividend 100036Intragroupdividendsfrom

p37Intragroupdividendsfrom

post-acquisitionprofitsRECORDEDPOSITIONSubsidiaryLtd:Proposedfinaldividendanddividendpayableof$1500ParentLtd:Dividendreceivableanddividendrevenueof$1500ECONOMICENTITYPOSITIONNoexternalpartyinvolved–nodividendsAt30/6/03SubsidiaryLtdprovidedfora$1500finaldividend.37Intragroupdividendsfrom

p38Intragroupdividendsfrom

post-acquisitionprofitsCONSOLIDATIONWORKSHEETDrDividendrevenue 1500CrDividendreceivable 1500DrDividendpayable 1500CrProposedfinaldividend 150038Intragroupdividendsfrom

39

Consolidation21

Consolidation240Theneedforadjustments AASB127:2typesofadjustmentsareneeded: (i)thesubstitutioneliminationentry(eliminating“SharesinSLtd”) (ii)entriesthateliminatetheeffectsof inter-entitytransactionssuchas-inter-entityservices,saleofinventoryanddepreciableassetsinter-entityborrowingsinter-entitydividends2Theneedforadjustments AASB41TheneedforadjustmentsThepurposeofconsolidatefinancialstatementsistoprovideinformationofdealingswithexternalpartiesonly.Hencetheeffectsofthetransactionswithinthegroupmustbeadjusted.AASB127para24“Intragroupbalances,transactions,incomeandexpensesshallbeeliminated.”3TheneedforadjustmentsThep42TheneedforadjustmentsAASB127para26Thefinancialstatementsoftheparentanditssubsidiariesshallbepreparedasofthesamereportingdate.Whendifferentthesubsidiarymustprepareadditionalfinancialstatementsasofthesamedateastheparent.4TheneedforadjustmentsAASB143Theneedforadjustments

Anyprofitsmadeoninter-entitytransactionsmustbeeliminatedbecause,fromagroupviewpoint,theyareunrealisedprofits.Eachgroupassetmustbeshownatitscosttothegroup(whichmaybedifferenttothecostrecordedbytheentitywithinthegroupthatcurrentlyownstheasset).5Theneedforadjustments44Theneedforadjustments

EachgroupliabilitymustrepresentanobligationtoanentityoutsidethegroupWemayhavetoadjustfortheeffectsofpriorperiodtransactionsaswellascurrentperiodtransactions.Thisisbecauseconsolidationadjustmententriesareappliedinaworksheetonlyandnotintheaccountsofeithertheparentoranyofitssubsidiaries.6Theneedforadjustments45TheneedforadjustmentsWhenitemsofstockaresoldwithinthegroup(e.g.PtoS,orStoP)anyprofitmadeonthesalemustbeeliminated.Theunrealisedprofitsontheseinternalsaleswilldistortstocklevelsindollarterms.Wewilleliminatetheseunrealisedprofitsbymeansofadjustmentstoopeningandclosingstockamounts.7TheneedforadjustmentsWhen46TheneedforadjustmentsUnrealisedprofitsoninternalsalesbecomerealisedgroupprofitsifandwhentheitemthatwassoldinternallypassestoabuyeroutsidethegroup.Whenthisoccursthegroupwillrecordsalesrevenueandthecosttothegroupofwhatwassold(COGS).8TheneedforadjustmentsUnrea47Example:PsoldanitemofstocktoSfor$100cash.Assumethatthissalewasatcost,sonoprofitwasrecognisedbyP.InthebooksofP: DrBank 100

CrSales* 100InthebooksofS:

DrPurchases* 100

CrBank 100*Groupeffect

Inventoryadjustments9Example:Psoldanitemofst48Inventoryadjustments

Thefinaleffectofthissalefromagroupviewpointis: DrPurchases 100 CrSales 100Toreversethiseffectandsoavoidoverstatinggroupsalesandpurchases: DrSales 100 CrPurchases 100Thisentryhasnoeffectongroupprofit.10Inventoryadjustments49Inventoryadjustments

Howisgrossprofitcalculated?ToreduceCr SALESREVENUE DrprofitDr-COGS Cr

profit

=GROSSPROFIT 11Inventoryadjustments50Inventoryadjustments

Howiscostofgoodssoldcalculated?

ToreduceDropeningstockCr

Dr+purchases CrCr-closingstockDrDr=costofgoodssoldCrReducingopeningstockincreasesprofitReducingclosingstockreducesprofit12Inventoryadjustments51InventoryadjustmentsAdjustmententriesmayaffectassetandliabilitybalancese.g.transferofinventoryataprofit.Wherecarryingamountsdifferfromtaxbase,tax-effectmustbeconsidered.Thelegalentity’srecordsconsiderthedifferencesbetweenthetaxbaseandthecarryingamountinthelegalentity.Onconsolidation,itisthechangeinthecarryingamountthataffectthisrelationshipandrequiresadjustment.13InventoryadjustmentsAdjustm52InventoryadjustmentsExample:IfSubLtdcarriesanassetat$100andthetaxbaseoftheassetis$80,SubLtdwillraiseadeferredtaxliabilityof30%x$20.Ifonconsolidationanadjustmentismadetoreducetheassetto$90,thecarryingamounttotheeconomicentity,thedeferredtaxliabilitymustbereducedby30%x$10.Combiningthelegalentities’recordsandtheconsolidationadjustmentresultsintheeconomicentity’spositionbeingshownintheconsolidatedfinancialstatements.14InventoryadjustmentsExample53InventoryadjustmentsAt1/7/00,ParentLtdsellsinventorytoSubLtdfor$1000ataprofitbeforetaxof$200.Taxrateis30%.Allinventoryisunsoldat30/6/01.RECORDEDPOSITIONParentLtd:

SubLtd:Salesof$1000 Inventoryat$1000Costofsalesof$800Profitof$200Incometaxexpenseof$6015InventoryadjustmentsAt1/7/54InventoryadjustmentsECONOMICENTITY

POSITION Nosalestoexternalparties Nocostofsalestoexternalparties Noprofitonsaleofinventoryto externalparties Costofinventoryat30/6/01is$80016InventoryadjustmentsECONOMI55InventoryadjustmentsCONSOLIDATIONWORKSHEETADJUSTMENTSales Dr 1000 CostofSales Cr 800 Inventory Cr 200DeferredTaxAsset Dr 60 IncomeTaxExpense Cr 60*Carryingamountofinventoryisreducedfrom$1000to$800.CA<TBby$200.(DTAof$200x0.3)17InventoryadjustmentsCONSOLI56InventoryadjustmentsAssumeallthetransferredinventoryissoldbySubLtdexternallyfor$1200by30/6/01.RECORDEDPOSITION

Parent

Sub TotalSales 1000 1200 2200Costofsales 800 1000 1800Profit 200 200 400Taxexpense 60 60 12018InventoryadjustmentsAssume57InventoryadjustmentsECONOMICENTITYPOSITIONSalesof$1200–toexternalpartyCostofsalesof$800–fromexternalpartyProfitof$400Taxexpenseof$120CONSOLIDATIONWORKSHEETADJUSTMENTSales Dr 1000 CostofSales Cr 100019InventoryadjustmentsECONOMI58InventoryadjustmentsAssumeat30/6/01thatSLtdhassold75%oftheinventoryexternallyfor$900.Thatisthereisendinginventorycontainingunrealisedprofitof$50i.e.25%x$200.RECORDEDPOSITION

Parent

Sub

TotalSales $1000 $900

$1900Costofsales800 750 1550Inventory - 250 25020InventoryadjustmentsAssume59InventoryadjustmentsECONOMICENTITYPOSITIONSales $900Costofsales 600 i.e.75%x$800Inventory 200 i.e.25%x$800CONSOLIDATIONWORKSHEETADJUSTMENTSales Dr 1000 CostofSales Cr 950 Inventory* Cr 50*Note:thisis25%xprofitof$200.Netresultistodecreasegroupprofitby$50.21InventoryadjustmentsECONOMI60InventoryadjustmentsAsinventoryisbeingreducedby$50,atax-effectentryisrequiredasCA<TBby$50:DeferredTaxAsset Dr 15 IncomeTaxExpense Cr 15Thedeferredtaxassetisreversedwhentheinventoryissoldexternally.22InventoryadjustmentsAsinve61InventoryadjustmentsAt1/7/01,inventorycontainingunrealisedprofitof$50remainsonhand.Intheconsolidationworksheetfor2001-02:RetainedProfits(1/7/01) Dr 35 IncomeTaxExpense** Dr 15 CostofSales* Cr 50SLtdrecordscostofsalesof$250,theeconomicentitywouldrecord$200.Resultisthatthisyear’sgroupprofitwillincreaseby$50beforetax.23InventoryadjustmentsAt1/7/62DepreciableassetsOn1/7/00,ParentLtdsellsplanttoSubLtdfor$1000.IthadacarryingamountinParentLtdof$800.Depreciationis10%p.a.RECORDEDPOSITION–Saleofasset

Parent

SubRevenue $1000 Plant $1000Carryingamountofassetsold $800 Incometaxexpense 6024DepreciableassetsOn1/7/00,63DepreciableassetsECONOMICENTITYPOSITIONNosalePlantheldatcostof$800CONSOLIDATIONWORKSHEETADJUSTMENTRevenue–Proceeds Dr 1000 CarryingAmount ofPlantSold Cr 800 Plant Cr 20025DepreciableassetsECONOMICE64DepreciableassetsAscarryingamountofassethasbeenreducedonconsolidationby$200,thenCA<TBorviewitasgroupprofitdecreasingby$200:DeferredTaxAsset Dr 60 IncomeTaxExpense Cr 60REALISATIONOFPROFITNoexternalpartyinvolvedProfitisrealisedasassetisconsumed–measuredbyreferencetodepreciation26DepreciableassetsAscarryin65DepreciableassetsDepreciation:SubLtddepreciatesplantat10%p.a.oncostof$1000i.e.$100Theeconomicentitychargesdepreciationat10%p.a.oncostof$800i.e$80CONSOLIDATIONWORKSHEETADJUSTMENTAccumulatedDepreciation Dr 20 DepreciationExpense Cr 20IncomeTaxExpense Dr 6 DeferredTaxAsset Cr 627DepreciableassetsDepreciati66DepreciableassetsSUBSEQUENT

PERIODS-ASASSETREMAINSONHANDCONSOLIDATION

WORKSHEET

ADJUSTMENTSALEOFASSETRetainedProfits(1/7/01) Dr 140DeferredTaxAsset Dr 60 Plant Cr 200Profitisstillconsideredtobeunrealised28DepreciableassetsSUBSEQUENT67DepreciableassetsAccumulatedDepreciation Dr 40 DepreciationExpense Cr 20 RetainedProfits(1/7/01) Cr 20IncomeTaxExpense Dr 6RetainedProfits(1/7/01) Dr 6 DeferredTaxAsset Cr 1229DepreciableassetsAccumulate68IntragroupservicesSomeexamplesofservicesbetweenrelatedentitiesincludeLendingofspecialistpersonnelforlimitedperiodsoftimeOneentitymayleaseorrentanitemofplantorwarehousefromtheotherAsubsidiarymayexistsolelyforthepurposeofcarryingoutsomespecifictask30IntragroupservicesSomeexam69IntragroupservicesSLtdpaid$30,000toPLtdfortheservices