Cases
Practical case
Valmer Group SA (fictitious entity) holds 36 % of the voting rights of Noral SA, 18 % of Pestel SA and units of the Quarvel fund. You prepare, for the 20X6 consolidated financial statements, the list of the interests to present and of the judgments to explain.
Your assignment
Attach each interest to a category covered by IFRS 12; compute the share of the votes cast held by Valmer in Noral and state the judgment to explain; do the same for Pestel; qualify Quarvel; state the disclosures on the composition of the group; record the dividend paid to the non-controlling interests of Noral, present its effect and conclude. One document is not useful.
Work on this file as you would in practice: read the situation, open the documents, sort the useful information, then carry out the work requested. The solution is revealed once you submit.
Fundamental level: the method, help and references are shown.
Method
File checklist
5 documents: open each one to read it.
Document 1Memo
Valmer Group SA (fictitious entity) closes its consolidated accounts on 31 December 20X6. Case conventions: amounts in EUR; the conclusions of management on control and significant influence are case data; case convention (pedagogical assumption, not attributed to IFRS 12): the dividends of Noral are paid in cash; the entry is illustrative.
The figures of the documents, gathered for your work.
| Item | Value | Found in |
|---|---|---|
| Voting rights of Valmer in Noral | 36% | |
| Voting rights present at the meetings (average) | 45% | |
| Dividends paid by Noral | €500,000.00 | |
| Share of the other holders in Noral | 64% | |
| Dividends paid to the non-controlling interests | €320,000.00 | |
| Voting rights of Valmer in Pestel | 18% | |
| Units of Valmer in the Quarvel fund | €600,000.00 | |
| Corporate social responsibility report | €12,000.00 |
Not every document matters: identify those that affect the accounting treatment.
Part 1 · Classification · Analysis
Sort each document: does it affect the accounting treatment?
Drag each item into its category, or tap the category under the item.
Group profile and case conventions
Noral SA: general meetings and dividends
Pestel SA and the Quarvel fund
Management note on the categories of interests
Corporate social responsibility report of the group
8 tasks in the order of the file. Calculations, entries and effects on the financial statements are marked; written answers are self-assessed against the solution.
Task 1Analysis
In which category of interests does each investee fall, and what does IFRS 12 aim at?
Set out the facts, the question raised, then your analysis.
This answer is not marked automatically: after submitting, you will compare it with the solution.
Task 2Analysis
Noral: what share of the votes cast does Valmer hold, and which judgment must be explained?
Set out the facts, the question raised, then your analysis.
Part 1 · Calculation
Noral: what share of the votes cast does Valmer hold, and which judgment must be explained?
This answer is not marked automatically: after submitting, you will compare it with the solution.
Task 3Professional judgement
Pestel: which judgment must be explained about significant influence with less than 20 % of the voting rights?
Distinguish the case data, the assumption and your judgment.
This answer is not marked automatically: after submitting, you will compare it with the solution.
Task 4Analysis
Quarvel: is it a structured entity, and does Valmer consolidate it?
Set out the facts, the question raised, then your analysis.
This answer is not marked automatically: after submitting, you will compare it with the solution.
Task 5Analysis
Which disclosures on the composition of the group and on the non-controlling interests of Noral must be provided?
Set out the facts, the question raised, then your analysis.
This answer is not marked automatically: after submitting, you will compare it with the solution.
Task 6Journal entries
Record the dividend paid to the non-controlling interests of Noral.
Identify the accounts affected and the direction of each movement; check the balance.
Part 1 · Journal entry · Journal entries
Entry 1 of 1
One line = one account and one side. Add a line if the entry needs more; the balance check updates live.
Line 1
Line 2
Task 7Effects on the financial statements
What is the effect of the entry on the consolidated financial statements?
For each financial statement, state the line affected, the direction and the amount.
Part 1 · Classification · Analysis
State the direction of the effect on each financial statement aggregate.
Financial position (balance sheet)
Profit or loss
Other comprehensive income
Equity
Part 2 · Calculation · Analysis
Quantify the effect on the aggregates concerned.
Result: Amount of the effect — Equity
Task 8Conclusion
Write the conclusion.
Write a conclusion that cites the facts and the treatment chosen.
This answer is not marked automatically: after submitting, you will compare it with the solution.
Your working draft for this file: points noted, leads, intermediate calculations.
Saved on this device only; never graded.
Complete every item of the file to submit it (0 / 11).
Document this file
These working papers use the data and results of this case.
Normative references