CAP2 Consolidation

Mark1916

Hi,

Im doing the Financial Reporting paper in the summer and im wondering how people are approaching the consolidation side of things? I tend to panic after ive identified the group structure!

Cookie_Monster

i'll presume that this is similar to P2 ACCA

1. structure
2. Goodwill (if any)
3. any changes from assoc to subs etc part way through year / partial consolidation
4. Inter-co sale and profit elimination
5. assocaite investment: calculate and check for impairment etc
6. NCI - non controlling interest amounts

R0N BURGUNDY

best not to focus on being overly neat because there's a fair chance of making mistakes and leaving stuff out. and its handy to leave each part/calculation open ended so u can go back and add more to it if necessary

Hackysack

A method that i've picked up as well is to actually draw out the P&L and Balance sheet and insert all of the line items that appear on the TB you're given.

I think the examiner reports stressed that people were just doing the workings and not transfering them into the actual financial statements.

It can take up to around 7 minutes to get the entire thing drawn up though. And it's not a total waste of time. If you don't do this (or if you run out of time and you skip to the next question) you lose your presentation marks, and they're the easiest marks you're gonna get!

The procedure mentioned above is generally a good way to tackle the workings as well.

prinz

Worst subject ever No idea OP, I'm in the same boat.

R0N BURGUNDY

the only way to do consolidation is to sit down and do exam questions repeatedly until you understand what you are doing and getting it right

smcgiff

R0N BURGUNDY wrote: »

the only way to do consolidation is to sit down and do exam questions repeatedly until you understand what you are doing and getting it right

Agree with the above.

Also, bear in mind that individual workings will garner marks and you don't have to get the whole thing balanced to get a pass mark.