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IAS 28Workpapers (Step 4 of 5)

Workpaper assignment

Step 4 of 5
Mission · workpaperWorkpaper · IAS 28L1 · Fundamental

Documents

Group profile and case conventions

Memo

Group profile and case conventions

Calvane Group SA (fictitious entity) closes its accounts on 31 December 20X6. Case conventions: amounts in EUR; case convention (pedagogical assumption, not attributed to IAS 28): the cost of Brissan equals the investor’s share of the net fair values at acquisition, so there is neither goodwill nor bargain income; Brissan applies Calvane’s policies, has no other comprehensive income in 20X6 and its fair values are those of independent valuations; the entries are illustrative.

Assessing significant influence: rebuttable 20 % presumption, indicators, potential voting rights, exemptions, held for sale and distinction from joint control: Brissan — direct and indirect rights

Significant influence: rebuttable 20 % presumption, indicators, definitions and basic equity method (cost, share, dividends)

4 documents8 sections to document
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Guided mode

Section 1 of 8

Objective

In progress
Section brief
What to document
The engagement, its scope and the working mode chosen.
Why
A workpaper answers one precise question: framing it avoids off-topic work.
How
Read the objective and the assignment, then choose the mode (guided, semi-guided, professional).
Expected result
You know which question the workpaper must settle, and for which reporting date.
Your role
Preparer of the IAS 28 workpaper
Level
Foundation
Estimated time
≈ 50 min
Progress
0 / 4 steps done (review excluded)

Context

Calvane Group SA (fictitious entity) holds interests in Brissan (30 % counting its subsidiary), Tolbec (15 %) and Mirel (18 %). You prepare the consolidation department’s note: which are associates, and how to account for Brissan in 20X6?

Assignment

Assessment of significant influence in Brissan, Tolbec and Mirel

Purpose of the workpaper

List the direct and indirect voting rights, the potential rights currently exercisable and the indicators of influence (board, policy decisions, material transactions, interchange of personnel, technical information), then support the conclusion. The 20 % presumption is rebuttable in both directions: it is never an automatic threshold and the indicators prevail over the percentage.

Questions of the file covered by this workpaper

  • Brissan: add up the direct and indirect voting rights, apply the 20 % presumption and conclude on significant influence.
  • Tolbec: at 15 %, does significant influence exist? Examine the indicators.
  • Mirel: at 18 %, is the presumption of no influence rebutted? Examine the indicators.
  • What are an associate, significant influence and the equity method, and which of the three entities is accounted for under the equity method?

Documents in the file

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