Question 4
ICAN
•
2026
•
FINANCIAL REPORTING
•
mixed
Case Stimulus
On April 1, 2024, Blessings Plc acquired 80% of Jigawa Limited’s ordinary shares when retained earnings were N20 million. The considerations consist of cash of N45 million paid on April 1, 2024 and an additional cash payment of N22 million payable April 1, 2025. No accounting entries have been made in respect of deferred cash payment. Blessings Limited has a cost of capital of 10%.
Additional Information
(i) Blessings Plc values non-controlling interests (NCI) at fair value at the date of acquisition. The fair value of non-controlling interests of Jigawa Limited on April 1, 2024 was estimated at N15 million.
(ii) The fair value of Jigawa’s Ltd items of non-current assets, liabilities and contingent liabilities at April 1, 2024 were equal to carrying amount with the exception of plant, which have a fair value of N12 million in excess of its carrying amount. The plant had a ten (10) years remaining useful life on April 1, 2024.
(iii) On December 2024, Jigawa Limited sold goods to Blessings Plc for N8.4 million, earning a gross profit mark-up of 20% on the sale. Blessings Plc still hold N5.8 million of those goods in its inventories at March 31, 2025.
(iv) Jigawa Limited still had full value of N8.4million in its trade receivables at March 31, 2025. Blessings Plc’s payable only showed N3.8million as it made a payment of N4.6million which was not recorded by Jigawa Limited until April 3, 2025.
Requirements
(
a
)
Prepare the consolidated statement of financial position for Blessings group as at March 31, 2025.
(
b
)
In the context of IFRS 10“Consolidated Financial Statements”, discuss the conditions in which a parent is exempted from preparing consolidated financial statements.
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About This Question
This is
Ican
2026
Financial Reporting
Question 4.
It is one of the
mixed
questions from the
2026
Ican
Financial Reporting
examination.