ACCA FR Eng Day 1 Game Changer Webinar Series June'26 | Pass APM First Attempt | Success Strategy

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[00:00:06]All right, good morning once again everyone and welcome to our grand webinar day one for June 2026 attempt.

[00:00:14]With this we have entered our revision phase. Last weekend, last weekend we had finished our regular six practice live sessions and like I had informed you all last week that this is just the end of basic classes. Things only become more intense from here. So like I said today will be a four almost a 3 hours session 2 and 1/2 to 3 and 1/2 hour session and tomorrow again we'll have a session of the same duration.

[00:00:47]What we are going to cover in both the sessions are 2020 marker questions, two 20 marker questions today, two 20 marker questions tomorrow and I'm going to pick up the most recent released material by the ACC body. So today I am going to crack one consolidation question from the prejune 2026 mock release. If you all are aware or if you might not be aware also I'll just inform you all that ACCA every quarter will release a mock.

[00:01:15]So a fresh mock by ACCA just prior to the exam. Okay. And it's been already released for our June quarter.

[00:01:24]Now what happens is in this mock you get the most recent question seted by the body. So ideally we should we should always have a look at these questions.

[00:01:33]We should always practice these questions. So today I'm taking a consolidation of financial position from this most recent release paper. The other recent release paper that I have is a December 2025 past paper. I don't have a March 2025 paper. I have a December 2025 paper. Right? So what we are going to do is again from there we'll take a consolidation of P&L. So 220 mark we'll drill and once we are done with these two tomorrow we'll take ratio interpretation of ratio question again from both these papers. Okay. So today's focus is consolidations.

[00:02:04]Tomorrow's focus will be interpretation.

[00:02:07]All right. So I'll just show you all as discussed a financial position question from June Primock and a consolidation of profit and loss about 2025 fast paper. Okay. All those who are not students of Viffy and just in case want to enroll for the crash course or the crash badge or the reset badge then you all can take the details.

[00:02:53]You can take a screenshot of this also. What I do guys is in the chat box in the chat box I will share the link of the group FR group which is freely available to join. Other groups are paid groups by VFI but there is one group which is open for everyone to join.

[00:03:17]Okay. So there you all can exchange knowledge, you all can you know uh post your doubts and uh there are TAs. So if possible TAs will try to answer. Um, I'll just share the link in the chat box because it's a bigger link, right?

[00:03:31]There's no point of taking screenshot of it. So, just give me a minute.

[00:03:48]I've put the link in the chat box for everyone. I've put the link in the chat box for everyone.

[00:04:02]All right guys, now with this we will begin our session. So come to the premark June 2026 released by the ACCA body. Go to your practice platform.

[00:04:13]Go to your practice platform.

[00:04:23]Once you're on your practice platform, once you all have selected financial reporting.

[00:04:28]So I'll just show you once you're on your browse available exams and once you select your financial reporting, you will have to select no variant. Okay, remember please select no variant. Once you select no variant, what you will see is all the available papers by this by on this portal. So come to FR prejune 2026 mock exam the recent release. Okay.

[00:04:54]and click assign to yourself.

[00:04:59]Once assigned, go and click on view assignments. I'm just going to give you all one minute to come to this portal, click financial reporting, no variant, and then FRPJ June 2026 mock exam.

[00:05:13]Just in case for someone the portal is not working, no need to panic. I'm the question is going to be right in front of you while I'm going to solve. So there's nothing to panic. You're not going to miss out on anything.

[00:05:25]Just in case anyone wants to do a parallel practice, y'all can do this also. You all can open the exam right in front of you. Okay. Once done, like I said, come to view assignments.

[00:05:38]In that financial reporting, you will click and then you will have your FRP June 2026 mock exam. Start. Yes, start exam.

[00:06:09]So you have to come to the navigator and come on question number 31. Come using your navigator and come on question number 31. This question is called Harvey company. Now remember what I'm showing you right now in the screen is also something that you will see on the actual exam day. The look and feel of your exam is going to be what you see right now. Which means half your half of your screen is going to be divided for the question and half for your solution.

[00:06:33]You can see that this is something which you can change. This is adjustable. So how much space do you want for your question and how much space do you want for your answer solution is really up to you. I would prefer that my question screen can be a little smaller and my answer screen is a little bigger. Okay, this is what I would prefer. See what you prefer for yourself guys. I would however prefer that I have complete visibility of my answer screen and question screen can while be still shorter.

[00:07:06]Okay. Now first I will read the requirement and understand what question is this. Once I know what question is this I will do the structure first. This is this is what you know that we've been drilling continuously for consolidation or single entity. Once you know what the question is, whether it's a P&L or balance sheet, you will do the structure and then immediately attack the question. Right? So I'm going to read the requirement and then understand what question it is. So requirement A is saying prepare the consolidated statement of financial position of financial position of Harvey Group as at 31st March 20X5 and this is worth the 16 mark. The next requirement is on 1st April 20x5 Haravik acquired 25% of Northway company for 18 million on what date? On the beginning of the year 31st March was end. So 1st April 285 is the beginning of the year. Acquired 25% of Northway for 18 million. Northway made a loss of 88 million for the year ended 31st March 28x6. Harve has no obligation to fund losses beyond its investment. What is the next requirement? explain how the investment should be accounted for and calculates its carrying amount at 31st March 286. So what I can see over here is that I will first independently crack this question which is on position and this I will take later on. There is no parallel solving required in the in these two. Okay. So I'll first finish this and then a bit a and then move to the next one.

[00:08:36]At this point my screen should be visible, I should be visible, the audio should be very clear. If any issues on any of this, y'all will let me know.

[00:08:45]Okay. Anyway, what I've come to know now is that this is a consolidation of balance sheet question. So, without wasting time, I'm going to start.

[00:08:54]Sorry, I'm not going to take an Excel sheet. I'll I'll do it over here so that you all will also get an idea of how to make you know the best use of the space.

[00:09:23]Yeah. Now you know because it's a balance sheet you have to have assets.

[00:09:28]Sorry.

[00:09:29]You will have your non-current assets.

[00:09:31]By the way, making this bold and all is not at all required in the exam. uh I'm just doing it because when you all are going to look while I'm solving things are clear for you all. Okay. So I can look at my left hand side whatever whatever is the format right I will quickly copy PP investments other investments leave line so that anything else you need to I will not actually do a subtotal of NCA and NCA total asset subtotal I'll do okay so I'm just leaving one line here just in case if any item needs to be added I have space inventory trade receivables I'll write short form cash then they are saying total current assets again I'm not going to write the word total current assets I'll write total assets only because like I said as such balance sheet format for your line what headers you're writing and this has no mark so you don't want to waste time okay then I have my equity so I have my share capital there's no share premium if you see to the left there is directly retain earning but I leave leave like two lines or one line whatever you want to and then you have your NCL but at least leave one line on the lower side at least leave one line okay non-current liability you have borrowings again leave one line just in case you want to add something then current liabilities trade payables you can also write TP that's also fine like how you wrote trade receivable same way you can write TP as well so I'm done with the balance sheet structure this should not take more than 2 minutes go to the right hand side 1 minute rather I would say one one and a half minute okay go to the right hand side for your working notes and you know this because you all have drilled the sum too many times a consolidation of balance sheet sum you all have done now too many times so you all should know what will come first so first is your group structure you won't just write GS parent and subsidiary relationship is what we also saw bit A was on parent and associate relationship. So you want you can write a PA as well and leave it that assets of subsidiary you know you have two columns at acquisition and post column. So do that you know here you will have your share capital there's no share premium weekend retain earning and whatever like all the adjustments leave few lines because you know adjustments are normally not one like there are two or three so leave few lines and then go to your working three which is your goodwill you know in goodwill you will have your purchase consideration add NCI less net birth and then again leave few lines just in case there is any impairment or something coming in picture then you need few lines okay then you have NCI so you know you have NCI at acquisition is NCI share in post acquisition profits if there is any adjustment then come to working five okay working five now working five what do we have in working five working five is GR.

[00:12:56]Okay. So you have parents detaining, parents share and subsidies and then you will have adjustments one by one. Okay. So now we'll start with the sum. We'll start with the sum. I have done enough detailing of my uh adjustments as well. I have done enough detailing of my face of balance sheet as well. So now let's start with the sum.

[00:13:27]So I'm going to read the first paragraph. Normally the first paragraph that you read even before your balance sheet format starts is on purchase consideration. This has always been the case. Every sum that you pick up right now any sum rather you pick up right now this is always the case. Okay. So let's begin. The following scenario relates to two requirements back two requirements background on 1st October 20x4 Harvey company acquired 75% of the equity shares of London company this first statement itself I have two information the acquisition date the acquisition date and the percentage acquired I will not waste time and quickly punch this detail okay first October 20X score and my year end is a 31st Mar of October November December, January, February, March. 6 months prior I acquired. So this is a midyear acquisition. This is a midyear acquisition. I need to be very clear that okay parent subsidiary relationship is a 75% and it's a midyear. So it's 6 months prior required just before the year end.

[00:14:32]I have to be very clear with this information. Okay. Otherwise what will happen is if you make a mistake in percentage if you make a mistakes in six months then you know everywhere that following mistake will get carried forward. At the end your balance sheet will not tally and you will just unnecessarily panic right you'll have to go and make adjustments to five six places in the if instead of six months you took one year adjustments or 9 months adjustments. So be very clear with the percentage and months at the beginning. Next, the consideration comprise immediate cash of 55 million, a deferred cash payment of 30 million on 1st October 20X5 and a contingent consideration of 10 million payable on 1st October 20X6 if Landon meets the specific performance targets. So look at this, they have a cash payment, they have a deferred cash payment, they have a cons contingent consideration. Three types of payments they are making. Okay. So you have to quickly go and embed for this.

[00:15:33]So how do I do? I will ideally do a working six for this. Now I will ideally do a working six for this purchase consideration because if purchase consideration has too many elements I will not do directly in the goodwill working meaning you can do of course but for me it just gets too congested. I like to do a separate working for purchase consideration always. So cash being third. No, the cash part was 55.

[00:15:57]So everything that I write away, I'm going to write in thousands. See, my balance sheet is in thousands. So all my workings will also be thousands. You can't have your workings now because it's just saying in million. I start doing my working in million. The balance sheet I'm doing in thousands. It's going to be a chaos. It's going to be somewhere or the other you're going to face mismatches and issues, right?

[00:16:16]You'll end up adding a millions to a thousand's figure. So of course you're going to get a wrong answer. So don't do that in the workings on the face of balance sheet or whenever you're doing a PL sum keep it standard answers workings everything in thousands okay so cash is a 55 million deferred cash payment is a 30 million payable on 1st October 20x5 we are standing at 1st October 20x4 and they are giving us a figure of 1st October 20x5 we have to pay 30 million okay and a contingent consideration of 10 million payable on 1st October 286.

[00:16:53]Now I can't record the deferred cash the deferred and contingent I have two more elements right I can't record the deferred of 10 million figure because sorry the deferred of 30 million figure because that's payable after one year so I need to discount it to present value so I'll have to read this paragraph more to understand where the discount where the present value is coming okay contingent consideration also I cannot recall because this is a 10 million because this the two years after figure.

[00:17:24]So this also I need to have what is the figure of 1st October not a 2 year later figure.

[00:17:30]The fair value of the contingent consideration was was assessed at at 7.5 million at 1st October 20X4 and 8.5 as 31st March 20X5. Now I want you all to tell me quickly in the chat box for my purchase consideration which is a figure of at acquisition which figure do I take for my contingent consideration should I take a 10 million figure should I take a 7.5 million figure or should I take a 8.5 million figure all three figures for same thing for contingent consideration but at three different dates this is a future date this is the at acquisition figure and this is a year end this is the ad acquisition And I think this is the year end whatever it is but there are three figures at acquisition year end and a future figure. Which figure do I take?

[00:18:24]So I'm getting mixed answers. Alice is saying 8.5. Usman and Anita are saying 7.5. The fair value of the contingent consideration was assisted 7.5 on 1st October 20x4. So I am talking about acquisition date of 1st October 20x4. So yes, 7.5 is the right figure. 7.5 is the right figure.

[00:18:46]So 7,500 okay but the year end figure that they have given me is a 8.5 right in my balance sheet in my balance sheet I should only have a year end but depending upon whether they recorded or not so I just see borrowings I don't see a year end contingent consideration recorded anyway once I finish the whole paragraph I will know how much of the contingent consideration is recorded in the balance sheet accordingly I'll go and make a correction in my balance sheet should Should I record full 8.5?

[00:19:15]Should I record differential? I'll see.

[00:19:18]Okay. Now, what it further says, Hari elected to measure the non-controlling interest in L London at a fair value, which was 20 million at the date of acquisition. So, NCI at the date of acquisition is a 20 million. Two places my NCI figure is going to go. Goodwill and NCI acquisition.

[00:19:41]Landon's retain earnings at acquisition date were 28.5. You know you're performing a working for net net assets of subsidiary. You are very much interested in what are the retain earnings at acquisition rate. So 28.5 on acquisition. Harvey recorded only cash consideration in its separate financial statements. Harvey uses the discount rate of 10% of the unwinding interest of interest wherever applicable. Harvey recorded only cash in its separate financial statements. So if you see Harvey's financial statements it says investment in laddin 55 million can you see a cash of 55 million was so one of the rules of consolidation is that you have to cancel the investment in subsidiary right so minus 55 million now I cannot sit and cancel the deferred and contingent element because they were not recorded in the first place so what do I go and subtract right from the investment of ladden if they were not recorded then what do I deduct so they are not recorded so this This is the investment side of it. The other side of this is that they should have been recorded as a liability not as an investment because investment needs to be cancelled in that fashion but as a liability in my group it should sit and that's not sitting because they clearly said that on acquisition Harvey recorded only cash consideration which means these figures are missing. So I need to record the consider consideration comprise immediate cash and a deferred cash payment of 30 million.

[00:21:07]payable on 1st October and uh this is my 1st October so I need to bring this to present value and they gave me a discount rate of 10%. So I'll do this. So come to your purchase consideration deferred no sorry this was contingent figure just make a correction the 7.5 was a contingent deferred I'll have to perform a calculation they told me deferred is 30 million after 1 year discount rate is 10% so I'm going to use this sorry no need for a minus So this is my purchase consideration.

[00:21:51]Okay. But there'll also be unwinding of deferred consideration by the year end.

[00:21:56]So by the year end this deferred consideration should increase. So finance cost on deferred consideration the increase impact 27273 into 10% into 6 by 12.

[00:22:22]Okay. Now in the exam in the real exam if you put the formula over here in the cell is more than enough because the examiner can very clearly see an open sheet you know you need not show it in the bracket again if you are punching the formula in the cell these two places can you see I have punched the formula so you need not show what I'm showing in the bracket what I am showing in the bracket for you is to absorb right now that what I have done in the cell my cursor is here you can't see this 2723 how did it come but because of this bracket you can see now how it came again 1363.6 six you don't know how it came but because of this bracket you know how it came so it's right enough for demonstration on the exam you will not do the same calculation at two places not required you'll waste your time one place is enough if you're doing in the bracket it's enough in the final cell probably because you were using calculator you don't you didn't do it right you have a final figure but that will not make sense in the exam this is a spreadsheet so instead of using the calculator have the formula embedded in the cell and let the let the spreadsheet do the calculation for you instead of calculator. Okay. So anyway, I have 1363.6 as a finance cost. So in my the deferred consideration at year end is going to be this figure plus 136. So 28636. So I have deferred consideration which they are saying they want to pay on 1st October 20x expire. So for me this is like a current li so also this 1363 is going to reduce my group retail learning. Okay, it's a finance cost. No, the unwinding of deferred consideration is a finance cost. Finance cost on deferred consideration. So, this needs to get recorded here.

[00:24:29]Negative sign.

[00:24:34]Now, one more thing we recorded for the deferred consideration, but we did not record for contingent. And they remember they told only cash element was recorded, nothing else. So I need to record for contingent as well.

[00:24:45]Contingent they're saying is payable on 1st October 2X6. So it's coming going to come in my NCL non-current liabilities.

[00:24:51]Now at the year end if I remember they had given us a separate fair value. So as at 31st month it had a fair value of 8.5 million. So contingent consideration is 8.5 million at the year end. Same way how you recorded the movement in the deferred consideration that it had an impact to my GRE. My GRE is dropping because it's an expense impact. My liability is increasing. It's an impact expense impact. So it will drop my GRE.

[00:25:22]Same way this is also a liability which is increasing from 7.5. It's becoming 8.5 again a movement in liability. It will impact my GR.

[00:25:33]So I have finance cost on cont not finance cost uh increase in contingent consideration.

[00:25:47]Okay that's a negative 1 million. So I'm just going to write it in this fashion.

[00:25:53]So I did all the aspects. First I calculated the movement and so first I calculated whatever is the at acquisition figures for these deferred and contingent because they're going to sit in my purchase consideration. Then I calculated the year- end figures that's sitting in the balance sheet. Then I calculated the movement whether finance cost or just an increase because that's going to impact my GE. So three figures are coming out of each adjustment out of each deferred and contingent three adjustments are coming. Okay.

[00:26:22]Now NCI they told me I did record for it so that is also done. Retain earning they gave me a figure I put it. So pretty much if you see from this first paragraph whatever information had to go in my balance sheet I have picked everything. I got all the marks for it.

[00:26:37]Okay. So if this is a 16 mark question this first paragraph itself must have you know captured 30% marks or 40% marks I would say of the sum. Okay. This itself if done rightly you are very close to a passing mark. You're very close to a passing.

[00:26:51]Now coming to the first adjustment after this at the date of acquisition the fair value of London's assets were equal to their carrying amounts except for a building whose fair value exceeded its carrying amount by 12 million at the date the remaining useful life of the building was 12 years okay so there is a increase okay so there is a increase in the building's carrying value. You know that if there is a increase in the fair value of the subsidiaries net assets whether increase or decrease in subsidiaries assets at the acquisition dates assets or liabilities you know there is a dedicated working called net assets of subsidiary and you have a at acquisition column specifically so any changes will come here so I will write increase in building is a 12 million okay and you need not even write such full sentences you can also just write increas in BLG. Okay, this is also enough. Now in the post column, what impact is going to come? Because there is a increase in the value of the building, depreciation impact is going to come. So negative depreciation divided by 12 years and because it's a midyear acquisition, you'll have to do a 6x2. Okay. Now the 12 million increase is going to also impact my PPE 12 million and the 500,000 drop is also going to drop it in the same fashion.

[00:28:26]So increase in the building and the post column impact both have been taken care of.

[00:28:35]Now next on 31st March 20x5 Hari issued a 60 million convertible bond at nominal value par. The bond pays interest annually in a years of 4% peranom on 3. So 4% is the coupon rate 60% is the face 60 million is the face value.

[00:28:58]On 31st March 287, bond holders can choose whether to redeem their bonds for its nominal value or convert them into fixed number of Harvey ordinary shares. Now look at this very carefully. The issue date of this bond is 31st March 285 which is right at the year end right at the year end issuing bonds and it's redeemable in two years itself. So it's just a two years calculation that needs to be performed if we need to perform right now. The market rate for a similar non-convertible bond is 10%.

[00:29:28]Harvey has recognized the proceeds of 60 million on the issue of convertible bond as borrowings within NCL. So entire 60 million has been recorded in the NCL.

[00:29:38]But if it's a convertible bond then recording entire 60 million as borrowings as a loan. Is it correct or wrong? Entire 60 million. If it's a convertible bond to record as borrowings, is it correct or wrong? In the chat box quickly, it's wrong. What element is missing?

[00:29:55]What should have been recorded?

[00:29:58]At acquisition date the initial measurement of a convertible bond one is the liability element and the other is an equity element. Equity element is missing. Absolutely correct Osman and Sri Krishna the equity element is missing.

[00:30:13]So anyway we'll do a quick calculation to do this equity calculation because they missed to do it. So we will calculate during the year the finance cost uh recording using the effective rate and all will not come in picture because you have to be very careful. You might have just seen a bond convertible bond. You might yeah you might have gone ahead with the initial measurement. You might have gone ahead with the subsequent measurement but sheer waste of time. You were only required you were only required for this adjustment to do the initial measurement only. Initial measurement only. Why? Why do I say this? Because this bond is issued on the 3rd 31st March 20 expire.

[00:30:52]It's a year- end date. So there is no effective interest impact that needs to sit in your retain earnings right now.

[00:30:59]Nothing. There is no year- end figure that you need to calculate after full one year how the bond is performing and you need to calculate whatever is the initial measurement split between uh liability and the equity that's only required. Okay? So be very careful with the dates. Don't start jumping to calculation till you have not read the proper information. So working seven convertible bonds initial measurement you need to have liability element, equity element.

[00:31:42]So for that you know that whatever are the cash flows. So I'll just write CF for that cash flows you have to find it find out the cash flows and then you bring it bring them to the present value. So if my face value is 60 million or the nominal value is 60 million the coupon rate is4%.

[00:32:03]Then you know that every year you're giving 2,400 that's the cash flow 2,400 but in the year two even the entire principal will be paid. So that's also your cash flow.

[00:32:17]Okay. Now always before start doing the present value calculation or doing the discount factor 1 by 1.1 1 by 1.1 quickly check the discounting factors have they been already given to you if there is a table already given to you never do it never do a divide by 1.1 okay so I have your you already have your discount factors so just take the discount factors now tell me at what rate do we discount it do we use 4% or do we use 10% %.

[00:32:50]Do we use 4% or do we use 10%. Okay, 10%.

[00:33:00]Sorry. So 909 and 829 826.

[00:33:15]So my liability element is coming to 53724.

[00:33:20]So liability is 53724.

[00:33:23]So equity element is going to be 60,000 minus the 537.

[00:33:28]So go to your balance sheet, go to your borrowings and link this. You can't have the full 60,000. You need to only have the liability element. Sorry, which is here.

[00:33:43]and the cell F for equity.

[00:33:50]So in equity I'll write other components of equity for my equity element and then again link the cell.

[00:34:06]Okay.

[00:34:09]So this was what was required. You need do not go and do a subsequent calculation that was not at all required.

[00:34:18]Now the next adjustment during February during February 20x5 which is coming in my current year London sold goods to Harvey for 8 million and made a 20% margin. Who is London? London is the subsidiary. So subsidiary sold to Harvey which means subsidiary sold to Parrot.

[00:34:37]So sold goods worth 8 million and made a 20% margin. And Harvey still has 3 million of those goods at the year end.

[00:34:45]Okay, very good. This is a classic URP sum. If you all remember my second live session was just continuously continuously drilling URP sums and the fair value adjustment. So you all should have had perfected in my live practice session two how to calculate URB. It should have not been you know a difficult task at all. Five sums of the um study hub we took and for all the five sums we had calculated URP. So anyone is still facing problem. If you had not watched that session go watch that session will become a piece of cake for you. Okay. Now if they have used the word margin if you see for the URP they have used the word margin. So can I just highlight where this word is? Yeah margin. So I will quickly do my cross multiplication table. I have my cost price. I have my profit element and then I have my selling price. Because they use the word margin, what do I assume as 100? Cost price or selling price and the profit element is 20.

[00:35:55]So 100 + 20 my cost becomes sorry 100 + 20 my cost becomes 80. What is unsold is 3 million. So 3 million over here and then the URP calculation.

[00:36:10]Now tell me one thing be ready with your answer in the chat box. Irrespective of whoever the seller is, where do I go and remove the UR from? Irrespective of whoever the seller is, this 600, where do I go and remove from?

[00:36:24]inventory. Very good. I hope everyone has finished all the study hub questions in your uh balance sheet practice file.

[00:36:32]I hope everyone has done that and not once. You all should have ideally finished a second round also by this time and single entity some should have finished by now.

[00:36:46]Okay. So 600 I'm removing from inventory. Now the other adjustment before I pass I need to check who the seller is. Who was the seller? Subsidy was the seller. So in which working should I go and pass the URP impact? If subsidy is the seller working to post column absolutely correct guys. So come to your working two and do minus ur but this is plus. So just make it negative.

[00:37:15]Okay. So can you see like in a minute you can close your URB adjustment in a minute while it can seem very complicated but it's not if you have practiced it in the right manner for me also why I can do it fast is because it's practice only right year on year or quarter on quarter what I'm teaching is a practice for me so if that same kind of practice now you're not doing it quarter on quarter quarter on quarter I'm probably practicing it one time or you are sum or two times right while I introduce while I'm doing another sum right but quarter on quarter if yall are doing that five sums practice or seven eight sums practice because again and again you all will come in different places as well right same expertise you can have on your it's no rocket science okay now at 31st March 205 London's trade receivables include 8 million due from Harvey so trade receivables from Harvey from parent for London is 8 million Harvey's trade payables include 6 million due to London why is there a interest. Ideally, they should be saying that the same figure is receivable and same payable. They can't have a mismatch. Now, let's read further.

[00:38:22]Harvey paid 2 million to London on 31st March 205. However, London had not recorded this in its accounts. 2 million was paid on the year end. So maybe because that cash is on the way, bank could not process it and it could not hit the London's account. London was not probably able to um account for it. But when I'm making my group financial statements, I have to clean this up. I have to have a common balance and I have to eliminate the intergroup transaction.

[00:38:51]So for cash in transit, the way you behave is you always assume as if the cash has already been dashed. Can you fill the blank in the chat box? As if the cash has already been received.

[00:39:04]Okay. So if you receive the cash 2 million, then at the same time you will you can't have your trade receivables higher by that account. You will have to drop your trade receivables. If you assume cash is received then you have to drop your trade receivables. Your trade receivables showed 8 million but now it will show 6 million. So 6 million 6 million is the common balance. Trade receivables trade payables reduce it.

[00:39:33]Okay.

[00:39:35]Now one more final adjustment that remains is they are saying at 31st March 20X5 goodwill arising on acquisition of London was assessed to be impaired by 10%. So there is an impairment on Goodwill now because I will not have my goodwill figure ready.

[00:39:55]If you see Goodwill is not ready yet there are so many things to be done. So what I can do is I'll have a goodwill here. Then I'll write less impairment.

[00:40:04]At least I'll put a placeholder for this so that when I finish the calculations line item wise I will not forget. Okay. And then I'll also create some space.

[00:40:23]Oh I'm not able to do that.

[00:40:29]What I can do is I'm just think I think this is a glitch in the uh CBP.

[00:40:41]If you do this in the real exam question for sure, you should be able to cut and paste.

[00:40:48]Anyway, we'll figure it out. Okay. So, I have the impairment and then I need the final goodwill. It's okay. I can fit my final goodwill here.

[00:41:09]Okay. Now guys, I finished the last adjustment as well. Now there's nothing remaining. This is the discount table that I have already used. So pretty much everything I used line by line, I did whatever I could. Now what remains for me is still if you see my consolidation is not yet done. Now what do I need to do for my consolidation? Line by line I need to finish each and every working note line by line. So do a fill in the missing blank approach. What is missing over here? Okay, here it's filled. Your my share capital is missing. So go fill your share capital. It's 50,000.

[00:41:42]So how much do I have 9500 at acquisition and then in the post what is missing is the retain earning of the post. So go check what is the retain earning at the year end for London it is 60,000. So 60,000 less than 2500 would be the post.

[00:42:37]Okay, sorry was not anyway. So 9500 is my at acquisition and the post column impact is a 3,400. You know that this at acquisition figure will go and sit in my goodwill calculation and post will get split between NCI and GR right so I will have my NCI share and then I will have my GRE share calculated I have slider yeah so 25% here and 75% to my G okay okay so now let's start giving them these values First 9500 is going and sitting in my goodwill. Then the split NCI 7,600 is sitting in the NCI working.

[00:43:25]Then the GRE split of 20 to 800 will sit in the G working.

[00:43:34]Okay.

[00:43:37]Now coming to the goodwill calculation.

[00:43:39]Purchase consideration I had already calculated. I just need to link the cell.

[00:43:46]So I will have a goodwill of 19273 impairment I will apply on this.

[00:43:57]So it's 1927 and my goodwill post impairment is 173 17345.

[00:44:06]So take the goodwill F23. I'll just write F23 and I'll take F23.

[00:44:17]It's better to remember the cell what cell reference it is rather than dragging the screen continuously. Okay, because it just becomes too timeconuming and slow. Now the impairment split also needs to go to my NCI and GRE. So take a split. NCI will get a 25%.

[00:44:35]And G will get a 75%.

[00:44:42]So go to your NCI goodwill impairment and go to your G.

[00:45:13]Yes, that's right everyone. The recordings are going to be available freely also on the YouTube. So, don't worry. Just in case if you have some work commitment and this is a working day for you, you'all can go ahead and proceed with the um normal working day and y'all can watch the recording later. Okay. So, I'm going coming to my NCI working 27118.

[00:45:36]So I go to my equity side.

[00:45:48]Parents retain earnings would check in your face of the balance sheet. Parents is 140,000.

[00:46:09]This is a figure of so I'm going to link it with F36 for GRE F36 then I have done everything right because after this whatever working was done was done to support the main five working so Main five workings line by line are closed which means everything would have been closed. Now come to your face of the balance sheet. Now let's close everything on the face of balance sheet. So on the face of balance sheet I have 150,000 as my PPE for parent. I need to add subsidiaries 90,000 and then take the adjustment 12,000 addition or 12 million addition and a 500,000 deduction. Investment in London needs to be canceled out completely zero. Other investments 20,000 is fine.

[00:46:58]Current assets inventory is 48,000 plus 30,000 - 600.

[00:47:07]Trade receivables are 36,000 + 26,000 - 2,000 - 6,000. You can see all the adjustments to the left. Cash is 12,000 plus 4,000.

[00:47:26]Yeah. Plus 4,000 plus 2,000.

[00:47:31]So I have my total assets coming to 438 245.

[00:47:42]Yeah. Now coming to the share capital, I will only take parents. Subsaries are cancelled. So 100,000 there nothing is missing here retain earnings borrowings. Yeah in borrowings I have just taken parents borrowings. So I will add 20,000 to it which is subsidiaries also that's been missed. Then the trade payables I have 21,000 of parent 20,000 of subsidiary and the minus 6,000 of the adjustment.

[00:48:20]And then we do a sum. If it's telling great if not telling we'll investigate into the mistake.

[00:48:27]438245.

[00:48:29]438245. Yes it is telling.

[00:48:35]Okay, it is telling. So we have done it correctly.

[00:48:40]So yeah, this is the point guys. This is how you will crack. The idea is the idea is what is the key takeaways when we crack these financial position and when we are watching the session the way in which you have to do it the structured format. First you do the balance sheet format. You do the working notes format.

[00:48:59]one by one read every line item and pick up everything that can go and sit in your working note and on the face of the balance sheet. Okay. So if you saw for every adjustment I did something in the working note and if it has an impact on the face of the balance sheet I did then in the face of balance sheet as well.

[00:49:15]Once I'm done with all the notes then fill in the missing blank approach for my working notes only. So one by one I will close all my working notes line by line from from the first working to the second working to the third working. I do that then I come to the face of balance sheet and one by one I finish the face of the balance sheet. Okay, just second 035 just I want to be like if it's very accurate or there is a point if there is a point error we will also find that Okay.

[00:50:05]So my good will calculation maybe there is a okay that's fine. That's because of the present value.

[00:50:28]Fine guys. Uh this also tallies with the solution. uh so there's nothing to bother in terms of the correctness. Now the requirement B I want to cater. So let's read requirement B. Now requirement B is specifically on an associate. If you recall what they said is on 1st April 205 that is at the beginning of the year how we acquired 25% of Northway for 18 million. You know if it's a associate if it's a associate the kind of accounting you do is an equity accounting. You do a equity accounting.

[00:51:04]So as per equity accounting the 18 million will be recorded as cost of investment.

[00:51:16]Okay. Now Northway made a loss of 88 million for the year ended 31st March 26. This subsidiary this associate has made a loss. So you know that the way you account for it is cost of investment plus or minus the share in the associates profits or share in the associates loss. So for here it will become share in the associates loss. So plus share in associates loss would be 1 second.

[00:52:10]into 25%.

[00:52:12]Okay, whatever that figure is and then you will have the figure at the end. So, Harvey has no obligation to fund the losses beyond its investment. Explain how the investment should be accounted for and calculate its carrying up. So, we quickly do this on our fair sheet now. We quickly do this on a fair sheet.

[00:52:31]Let's go below here. You don't need this pretty much requirement fee Northway. The company is Northway.

[00:52:53]25% of investment in Northway means Harvey has significant influence and therefore it should be recorded like an it should be recorded it should be recorded as an associate using equity Initial cost of investment will be recorded and the profits or losses earned by associate up to parents share will be added. So first I demonstrate what we're doing. Okay. So cost of investment is 18 million.

[00:53:52]Share in associates losses is 88 into 25%.

[00:54:14]It's a loss. So 88.

[00:54:17]for the year >> 25%.

[00:54:23]So the figure that you're getting is a negative 4 million. The figure that you're getting is a negative 4 million.

[00:54:34]Yeah. The figure that you're getting is a negative 4 million. Now what they told us explain how the investment should be accounted for and calculate its account its carrying amount at 31st March 20x6.

[00:54:45]So we just explained how the investment should be accounted for and we also calculated it amounts but then they made a very specific disclaimer that Harvey has no obligation to fund losses beyond its investment. So if its investment is $18 million it will not bear a loss beyond 18 million which means that we need not record it like a negative. It can be a negative zero only. The maximum loss that we can have is that this investment can become zero because whatever we invested that can go away.

[00:55:12]Nothing beyond that we have an obligation. So we need to make a further note that even though the investment as per calculation is -4 -4,000 which is an I would just write4 million as the losses are restricted only to the invested amount.

[00:55:51]The associate in the balance sheet will now reflect at a carrying amount of zero rather than -4.

[00:56:20]Okay, this is the only disclaimer that we have to provide here.

[00:56:27]So with this we come to an end of this sum and don't worry I'll manage to share this answer with you all. So you all will have this. Now I'll we'll just take a 10-minut break because again the next sum is also going to be a little heavy right so we'll just take a 10-minut break and then we'll continue with our session okay all right everyone the way in which now we have covered one of the questions in similar fashion we're going to take the precember 2025 another most recent release so you will select financial reporting as exam category the variant should be no category only if you Select no category rightly. The papers will reflect. We already did a question from prejune. Now what we targeting is a FR September December 2025 paper the past paper.

[00:57:15]Okay. So assign this and then go and click your view assignments.

[00:57:20]You will have the September December.

[00:57:22]Click start.

[00:57:34]What they have given you is only a section C. Here they have not given a section A and a B. Okay, they have not given a section A and a B.

[00:57:44]So let's start come to question number two. Just navigate quickly through the whole screen because they're not allowing us to go to the next screen. So just finish navigating and then go to question number two. Okay. So if you see this question, it's a P&L format and requirement is calculate the goodwill arising on the acquisition of Strawberry at 1 July 20X5 and prepare the Pratit group's consolidated statement of profit and loss for the year ended 31st March 20X6.

[00:58:15]Okay. So what I'm going to do is now this question I'm going to solve in Excel because one question what we did is already on the um you know the platform. So you got to see that how do you crack it on the screen right the one disadvantage when I have to share the answer with you is that I will have to share it in the form of screenshots right so you all can't double click and tell the check the formulas so for practice sake one question I did there is fine and I've taken the screenshots and preserve because there's no way I can copy paste there's no option to copy paste and bring it here the only thing I can do is take screenshots so for live question two what I'll do is because you have everything around it you have the formula you can double click on the cell you can check where to go I'm going to do it on the Microsoft only so that when I share it you have the solution for both. Okay.

[00:59:01]Now first is calculate goodwill and then second is PNL sum. So requirement A is on goodwill. Goodwill at acquisition date and like I said the first thing I'll do is get done with the formula uh the format. So purchase consideration you know goodwill is purchase consideration at NCI less net worth. Now you know that when you did a goodwill calculation in the full balance sheet sum this is all you had to do because for net assets there was a dedicated working three. So you did not leave any space for net assets. But if this is not a balance sheet sum if this is a P&L sum then you'll have to leave space for the net assets working because now you will have to do your net assets working here itself. Your share capital share premium retain earwning and whatever is going to come will come here only right and you will use end up using two columns. one inner column for your subfigures like share capital, share premium and for purchase consideration NC and the total of net assets you'll use the outer column. So be very systematic in your approach. You should already know how you're going to attack the sum okay and where where what will be okay that you should know. So I'm going to leave enough space and then put a format for requirement B which is consolidated statement of profit and loss.

[01:00:14]I'll have to do this cracking parallel because they both requirements are interlin. If I have a impact over here, there is a good chance that that impact is also going to sit in my PNL. So I'll have to do it parallelly. Okay.

[01:00:25]Revenue plus cost of sales gross profit.

[01:00:29]Then I need to see what kind of what fashion have they expressed the operating expenses in. So they have given subtotal called general admin and selling.

[01:00:40]General and admin selling.

[01:00:48]And you know that this is now a mandatory subtotal called operating property. This is a mandatory sub to then you have investment income profit before financing and income taxes.

[01:01:14]And then you have your interest expense profit before tax income tax expense.

[01:01:17]Okay. So, of course, this is standard.

[01:01:25]Okay. for income taxes income tax expense.com profit for the year profit attributable to parent NCI and then you will have your workings towards the right working note group structure just like how you add in your balance sheet parent and subsidy relationship and working two is MCS per subsidy is profit adjusted profit insation okay here also I got done with my PNL format PNL format is this much and now I begin with the sum So they're saying on the 1st July 20x5 Patri company acquired 80% of the $1 million one ordinary equity shares in strawberry the purchase consideration comprised of 19 million cash payable immediately and 2.4 million payable on the 30th June 287. So can you see 30th June 287 is 2 years from now. Okay. And you acquired on 1 July 20X5. So by the way you also want to check that when they say first July to index 5 is how many months before 31st March. These are 9 months before 31st March. So you need to do the relationship. It's 80% and 9 months. Very important. 80% and 9 months.

[01:03:06]Okay. Now the appropriate discount factor to use using a cost of capital of 10% is826.

[01:03:15]So you know that when you're going to do the goodwill calculation you have purchase consideration right you can do a adjustment for purchase consideration working three PC you have immediate cash and then you have debit consideration so immediate cash is coming up to 19 million and then 2.42 is to be discounted 2.4 sorry it's 2.4 Four is to be discounted by using the rate which is 826.

[01:04:02]So I have 2982.4.

[01:04:05]I have 2982.4.

[01:04:08]So, I'm going to go and put this in my purchase consideration.

[01:04:22]Yeah. So, if I'm not wrong, this factor that they have given is for two years only. When they will use the word, the appropriate discount factor to use using a cost capital of 10% is.826.

[01:04:34]Then for me when they use the word appropriate it means they have given me for 2 years. It means that they have given me for 2 years. Okay.

[01:04:50]No worries.

[01:04:55]All right. Now sorry just one second.

[01:05:19]Yeah.

[01:05:25]So what I did is now I have discounted it to present value and uh I have this figure. Now what else remains is that see if this was a balance sheet sum I would have taken this figure to the balance sheet as at the most updated value. This is not balance sheet sum I need not do that. But there is one more thing that I need to do is do the unwinding. So I'll take care of the unwinding at least. So unwinding of effort consideration 1982.4 into 10% because you know you use 10% to bring it to the present value.

[01:05:54]Can you see it was 10%. But I'll do a into 9 by 12 because it's not for the whole year. I have 148.68.

[01:06:02]So now wherever I have one mistake that we have done guys is that everywhere we should have managed to leave a one line space. Okay. So everywhere you should have managed to leave one line space after every subtotal. do this please as a practice because you know you saw the way how restricted is the exam portal right and you could face such restrictions on the real exam sheet also so you can't cut and do a pasting later right so you better leave enough space at the beginning right one month's line space at the start only anyway unwinding of deferred consideration so you have a section for interest expense Now interest expense is going to be interest expense on your borrowings normally. So what I can write is unwinding unwinding of deferred consideration of it and then link it.

[01:07:01]Okay. So I did two things. I calculated the purchase consideration and took it to my goodwill working. I calculated the unwind and I took it to the face of my PN.

[01:07:11]Now let's read further.

[01:07:14]On 1st July 20X5, the net assets of Strawberry had a carrying amount of 15 million. The fair value of the net assets of Strawberry on 1 July were the same as their carrying amounts except for the plant and inventories.

[01:07:27]So you have the net assets at a carrying amount of 15 million. But you know you have to take fair value not the carrying value. So you have to incorporate for the changes in this.

[01:07:41]So, Usman is asking is it a wrong presentation if we add the unwinding to interest expense. There could be a problem that a half mark would be cut because here it's written interest expense on borrowings. So, if it's on borrowings and if you add it in that category then it's a problem. Okay.

[01:07:57]Let's say if you kept just as interest expenses very generic name in the P&L right now then there is a very less chance that our half mark would be cut.

[01:08:06]Okay.

[01:08:12]Anyway, coming back to my uh this thing.

[01:08:15]So, the net assets carrying amount was 15 million and the plant uh there is a difference in the plant and the inventories fair value. So we will get into that.

[01:08:29]Sorry doing it on the Excel. Right. So the net assets I have plant and then I have inventory and they're saying there is a difference in that. The plant has a had a carrying amount of 4.1 but a fair value 4.9. So there is a difference over here. So let's do the difference accounting 4.1 and 4.9.

[01:08:59]So this is going to come up to 800.

[01:09:03]Keep the major totals outside and the subtotals inside.

[01:09:08]Okay. Then what about inventory?

[01:09:10]inventory they are saying okay even for the plant they're saying the estimated remaining useful life of this plant at 1 July 20X5 was four years so when you're accounting for the difference you know that there is a depreciation impact that will also come in picture which is going to be charged to your cost of sales so first do that part as well so working for I do and uh fair value impacts so depreciation due to plant.

[01:09:40]So that's going to be 800 800 divided by 4 into 9 by 12.

[01:09:48]4 years is what they said the life is.

[01:09:51]Yeah. So when I do this, I have an impact of 150.

[01:09:59]So go to your cost of sales and add the depreciation 150. Okay, you want this depreciation 150.

[01:10:08]Then I have another impact that they're talking about is inventory. So inventory had a carrying amount of 2 million but a fair value of 2.21. All these inventories were sold by Strawberry Company between 1st July 20x5 and 31st March 20x6.

[01:10:23]So by the year end it was already sold but inventories fair value at acquisition date had a 100,000 extra. So inventory will be 100,000 extra. But this inventory will also be impacting my cost of sales because this is a increase in the existing inventory right of purchases or opening inventory. So that had to be high. So plus 100 inventory fair value. Okay. Plus 100 inventory fair value.

[01:10:51]Yes. Absolutely correct. So man is reminded that the depreciation is also going to impact my working to because it's subsidiary related. Because it's subsidiary related it will impact my working too. So come to your working two subsidies profit the depreciation will be deducted from here even the inventory will have an impact.

[01:11:14]So fair value of inventory.

[01:11:19]So how many places the impact went in my cost of sales impact went and in my NCS perl impact.

[01:11:26]Okay, the fair value impacts went to two places. My face of P&L and my NC asper P&L and at acquisition impacts also sat in my goodwill. At acquisition impacts also sat in my goodwill.

[01:11:41]Okay, now the next one.

[01:11:49]Patridge measures non-controlling interest at fair value. The fair value of an ordinary equity share in Strawberry Company at 1 July 20X5 was $1.13.

[01:11:59]Patridge measures non-controlling interest at fair value and the fair value of the ordinary equity share in Strawberry Company at 1 July 20X5 was 13. So I will do that check quickly. So 20% is the NCI and I know that we said that we have acquired 1 million ordinary shares of NCI. So 1 million into 20% into 13 for me for my NCA measurement and this can be in my outer column because this is the major subtotal that I'm talking about. So that's coming up to have I taken the right figures 100 million yes into 20% into correct. So it's coming up to 260,000.

[01:12:45]This is coming up to but something seems off. My purchase concentration is much smaller than my um NCI. Right? So something is wrong.

[01:12:57]Let me see what figure. Okay, it's 1 million. Of course, it's 1 million. So I should take 1 million as 1,000.

[01:13:05]I'm writing the answer in thousands. So 1 million should be written as 1,000.

[01:13:12]Yeah, now it's going to sit correct.

[01:13:15]Okay. for year I think it's simple that you had to do a NCI calculation you checked how much NCI how much shares subsidiary had it was 1 million so 1 million into 20% into dollar3 the fair value now further between 1st July 20x and 31st March 26 patri company sold goods to strawberry company for 3 million which had a markup of 25% on cost on 31st March 26x the inventories of strawberry included 900 of these goods we just solved the URP so we know how to tackle it okay But first of all they said that the intergroup transaction in the current year was 3 million. So first just remove the intergroup transaction from your revenue and cost of sales 3 million deduction common revenue common cost of sales enter then I will do the URP working. So working five for my UR cost, profit, selling price. They use the word markup. Can you all tell me what will be assumed as 100? They use the word markup. What will be assumed as 100?

[01:14:20]Cost selling price what? Cost.

[01:14:23]Absolutely correct.

[01:14:28]How much is unsold goods? 900. So 900 180.

[01:14:45]So you add 180 URL and then you check who the seller is. Who was the seller? Patrick sold goods to Strawberry Company which means parents own two subsidiary. So if parents own two subsidy then this URP I already adjusted in cost of sales. Do I need to adjust anywhere else or this is enough?

[01:15:05]Do I need to adjust anywhere else? So this is enough. Adjusting over here in my cost of sales. Is this enough or do I need to adjust? Working five. This is not balance sheet. No Alice this is not balance sheet. If it was a balance sheet sum then you were right.

[01:15:20]This is enough. If subsidiary was the seller then where else would I have to gone and do the adjustment? If subsidy was the seller, where would I have gone and done the adjustment? Working to? Absolutely correct. Here I would have done the adjustment.

[01:15:34]Okay.

[01:15:37]Then on 30th September 2X5, Strawberry Company paid a dividend of 2 million.

[01:15:41]Patridge company accounted for this dividend correctly in its statement of profit and loss. Listen carefully. You might think that it's correctly recorded. No need to do anything. No, they need there is adjustment that needs to be done. Strawberry paid a dividend of 2 million meaning subsidy paid a dividend of 2 million. Parent company Patri Company accounted this dividend correctly in its P&L.

[01:16:02]In parents individual statements this dividend income is recorded. But in a consolidated statement are we allowed to have this dividend income? In a consolidated statement we are not allowed to have it. So we'll have to take that dividend income and remove it. So you had investment income line. So you must have had it in your spreadsheet as well. The investment income line remove it. So 2 million is the distribution but they must have given to you your share which is 80%. So remove that much. 2 million into 80% needs to be removed.

[01:16:53]Okay, so Shri Krishna is asking why we remove 2,000 for intergroup transaction. Okay, I think that's a typo mistake. Thanks for pointing it out. If the intergroup transaction is a 3 million, one second 3 million was the intergroup transaction. I think I made a typo error. If you may see in the cost of sales also, I should have removed 3 million. Nobody else pointed only Krishna pointed both the places 3 million 3 million into group into group 3 million 3 million okay then let's proceed so we're done with the notes whatever we could do as an adjustment from the notes we have done now same approach come to the working notes and wherever there is a missing blank let's adjust for it so group structure is closed NC as for PNL NC as for PNL Subsidies profit I need to take. So subsidies profit is 4,200.

[01:17:54]So I can't take 4,200. I will pro into 9 by 12.

[01:18:00]Okay. Then I have adjusted profit and then I will have NCI share which is a 20%.

[01:18:09]I'm just writing things in the bracket so that you all know where these figures are coming from.

[01:18:15]You need not show it to two places.

[01:18:17]Okay. So 580 is this.

[01:18:23]Let's just cross check also parally.

[01:18:37]Yeah, it's fine.

[01:18:41]Now continuing.

[01:18:44]So 580 580 I have linked over here for NCI. Now I'm going to continue. Purchase consideration adjustment is pretty much closed because whatever I had to do I had already pulled. Fair value impacts closed URL closed. Come to the face now.

[01:18:56]So coming to the face of goodwill first.

[01:18:58]So goodwill I already uh purchase consideration already pulled. NC I pulled for net assets I need my share capital of subsidiary. I need share premium and retain earnings. So share capital will be 1 million. They had mentioned if I am not wrong let's go back to the question and see $1 million one equity share so 1 million we're going to write it as a,000 retain earning at acquisition date we'll have to see how much it was okay guys the way it's being given to us now is that we do not have share capital. We would rather have share capital sorry we have share capital split form but we do not have a retain earning split form. Share premium is not required. We do not have a retain earning split form. So how do we tackle it? So basically if you recall they had given us the carrying value of the net assets. The carrying amount of net assets is a 15 million. So what we need to do is we need to take the net assets carrying amount and just take care of the adjustment only. So net assets carrying amount is carrying value. I'll replace this carrying value is how much? 15 million.

[01:20:19]And to that we are making adjustments and to that we're making adjustments. So in this fashion we'll have to tackle it.

[01:20:25]So every sum could be a little unique in its fashion. So no need to do it in a segregated form like share capital share premium ret because you don't have that kind of information. You don't have a separate retain on it. So this is how it is supposed to be tackled that take the carrying amount and take the adjustments to it.

[01:20:41]So you have a good will of 7682.

[01:20:44]You have a good will of 7682. Yes, that's right Google that we will use 15.

[01:20:49]That's what I have done. Now coming to the PNL. Coming to the PNL. So revenue we have 35 and 24. So take 35,000 + 24,000 yeah 24 into 9 by 12 - 3 cost of sales is 21 and 40 + 150 + 100 - 3 million + Then you have general and admin 4 and 2.8. So 4 million plus 2.8 I'll have to take separately in a bracket. So I'll take 2.8 into a 9 by I'll just make sure for my revenue also I did a 9 by 12 correctly. Okay. I think for my cost of sales I missed only the 9x 12. 14 into a 9 by12.

[01:22:09]Yeah. So that will change things for you.

[01:22:15]Selling and distributions selling expenses is 2 and 1.2.

[01:22:20]So negative sign outside the bracket in + 1.2 2 into 9 by2 so 12070 then I have investment income so investment income is 4.2 and 200 so 4.2 2 + 200 into 9 by 12 or then copy what is there over here 2 into 8%.

[01:23:03]Then we have interest expense 2 and 1.

[01:23:17]Wait a minute. Need to take the negative sign outside the bracket of interest expense.

[01:23:23]So profit before income taxes and then I have income tax expense itself which is 25 2 450 and 1. 2 450 again negative sign outside the bracket 2 450 plus 1 million into 9 by 1 profit for your attributable so it's coming as uh sorry one second sorry I did not do the profit for the coming as 8141. Is anyone else getting a 8141?

[01:24:16]Yes, that is the correct answer. 8141 split and 580 split. Okay.

[01:24:22]So yes, this is it. With this we come to an end to a P&L sum also. Again, same approach. I'll just repeat the approach.

[01:24:27]We did the structure first for PNL and the Goodwill working. Goodwill working and PNL as in when we kept reading the adjustments we kept filling the workings and the face of PNL and the Goodwill working. Then once we were done with the workings we did the fill in the missing blank approach for working notes. Once working notes were closed then we did the fill in the missing blank for the performer of the Goodwill note and the PN this is the approach you have to stick to always because if you keep changing your approaches on the exam date you will not have one method you will not be able to do things fast. It's about doing things fast, right? It's not just about doing it um correctly, but it's also about doing it correctly and fast. Otherwise, you don't have the leisure or the luxury to you know do a tally answer or to do a correct answer in and take entire 3 hours to do it. You don't have that leisure. You know, you will not be able to touch the passing mark if you do that. So, fast and correct both are important. Okay.

[01:25:26]So, with this we come to an end to day one webinar session. Tomorrow there is a day two webinar session. So I want you all to attend it because you can see that we crack heavy sums to 20 mark sums in the same day. So that that really increases your ability to crack the uh sums immensely in the small session right like in a one day session your ability increases a lot. So same thing tomorrow um with this I will close this session. I'll take a hard stop here and see you all tomorrow. Next week in the grand revision I'm going to drill many standards okay many standards just one by one a revision of standards so please make sure you all are also attending that okay fineman when you're talking about two subsidiaries the way we trade uh the way we treat it is going to be the Same if the treatment is parent to subsidiary, parent to subsidiary relationship. If the URP relationship is between parent and subsidiary for subsidiary A and again a URP relationship is between parent and subsidiary or subsidiary B.

[01:26:39]Okay. Like you have a 70% and a 80% in two other one subsidy and the other subsidiary is it's absolutely the same treatment. You will have to remove you'll have to add the URPS both the URPS to cost of sale irrespective of whoever is the seller. Then each relationship you will have to check who is the seller in relationship one and who's the seller in relationship two.

[01:26:58]Okay. If parent is the seller in the relationship one don't do anything. If parent is the seller in relationship two then go and adjust it to NCS for PNL.

[01:27:07]Okay. This is it. But this is not what is going to be tested guys.

[01:27:14]The next week revision session is not free session dear. It will be on Saturday but it is a paid session. So only the students will be able to attend it. Only the students will be able to attend it. It's a paid session. If youall are joining a crash course then uh you all will also have the link and you all will also be able to attend but it's not going to be a free session.

[01:27:35]It's going to be there for regular students, research student and crash course students only.

[01:27:41]again. I'll flash the contact number.

[01:27:52]Okay, thank you everyone. Have a good weekend and yes, use your week very wisely. Please um don't prioritize any other commitment other than your commitment towards ACC in these two weeks, please. Okay, thank you everyone.

[01:28:07]Bye-bye.