Loss of control

Learning objectives

• Calculate the portion of the gain on loss of control attributable to measuring the retained investment at fair value.L3
• Identify the disclosures required about a loss of control (gain or loss, line item in profit or loss).L2

Normative references

• IFRS 12 §19If control of a subsidiary is lost during the period, the entity discloses any gain or loss calculated in accordance with para. 25 of IFRS 10, the portion of that gain or loss attributable to measuring any investment retained in the former subsidiary at its fair value at the date control is lost, and the line item(s) in profit or loss in which it is recognised if not presented separately.

Original summaries of the paragraphs (reference register), never a quotation of the standard.

2 questions

• Titan SA loses control of Pollux SA by selling part of its shares; it keeps an investment whose fair value at the date of loss of control is {fair_value_retained} and whose carrying amount is {carrying_amount_retained} (case data). Calculate the part of the gain on loss of control attributable to remeasuring the retained investment to fair value, a part that IFRS 12 asks to be disclosed.L3
• A colleague writes: "On loss of control of a subsidiary, IFRS 12 asks only for the total gain or loss on the disposal to be disclosed; the portion arising from remeasuring the retained investment and the line item in profit or loss that includes it need not be specified." What is the error?L2