Question 7.7 (Cash flows from investing activities)
Paragraph 42 of AASB 107 requires that the cash received or paid for the disposal or acquisition of controlled entities must be reported on a net basis. Acquisition of a subsidiary will be cash flow positive for the group where either:
(a) Consideration for the acquisition of the subsidiary is non-cash (e.g. shares) and the subsidiary has a positive cash balance; or
(b) Consideration for the acquisition of the subsidiary is cash (or includes cash) and the subsidiary¡¯s cash balance as at the date of acquisition exceeds the amount of cash consideration paid; and
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(c) The acquisition occurs at or new the end of the accounting period and the consideration is deferred.
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