accounting for existing financial instruments on the step acquisition of an associat 611775

Accounting for existing financial instruments on the step-acquisition of an associate or a joint venture (fair value (IFRS 3) approach) Using the same information as in above, under a fair value (IFRS 3) approach to acquisitions in stages, in the consolidated financial statements of the investor the fair value of the 10% existing interest would be deemed to be part of the cost for the initial application of equity accounting. The 10% existing interest is effectively revalued through profit or loss to $150. Any amount in other comprehensive income relating to this interest would be reclassified to profit or loss. Goodwill would then be calculated as the difference between $375 (the fair value of the existing 10% interest and the cost of the additional 15% interest) and $300 (25% of the fair value of net assets at the date significant influence is attained of $1,200).