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38 Porter The following consolidated financial statements relate
38 Porter The following consolidated financial statements relate
The following consolidated financial statements relate to Porter, a public limited company:
PORTER GROUP: STATEMENT OF FINANCIAL POSITION AS AT 31 MAY 20X6
20X6 20X5
$’m $’m
Non-current assets
Property, plant and equipment 958 812
Goodwill 15 10
Investment in associate 48 39
1,021 861
Current assets
Inventories 154 168
Trade receivables 132 112
Financial assets at fair value through profit or loss 16 0
Cash and cash equivalents 158 48
460 328
1,481 1,189
Equity attributable to owners of the parent
Share capital ($1 ordinary shares) 332 300
Share premium account 212 172
Retained earnings 188 165
Revaluation surplus 101 54
833 691
Non-controlling interests 84 28
917 719
Non-current liabilities
Long-term borrowings 380 320
Deferred tax liability 38 26
418 346
Current liabilities
Trade and other payables 110 98
Interest payable 8 4
Current tax payable 28 22
146 124
1,481 1,189
PORTER GROUP: STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 MAY 20X6
$’m
Revenue 956
Cost of sales (634)
Gross profit 322
Other income 6
Distribution costs (97)
Administrative expenses (115)
Finance costs (16)
Share of profit of associate 12
Profit before tax 112
Income tax expense (34)
PROFIT FOR THE YEAR 78
Other comprehensive income:
Items that will not be reclassified to profit or loss:
Gains on property revaluation 58
Share of gain on property revaluation of associate 8
Income tax relating to items that will not be reclassified (17)
Other comprehensive income for the year, net of tax 49
TOTAL COMPREHENSIVE INCOME FOR THE YEAR 127
Profit attributable to:
Owners of the parent 68
Non-controlling interests 10
78
Total comprehensive income attributable to:
Owners of the parent 115
Non-controlling interests 12
127
The following information relates to the consolidated financial statements of Porter:
1 During the period, Porter acquired 60% of a subsidiary. The purchase was effected by issuing shares of Porter on a 1 for 2 basis, at their market value on that date of $2.25 per share, plus
$26m in cash.
A statement of financial position of the subsidiary, prepared at the acquisition date for consolidation purposes showed the following position: $’m
| Property, plant and equipment |
92 |
| Inventories |
20 |
| Trade receivables |
16 |
| Cash and cash equivalents |
8 |
|
136 |
|
| Share capital ($1 shares) |
80 |
| Reserves |
40 |
|
120 |
|
| Trade payables |
12 |
| Income taxes payable |
4 |
|
136 |
An impairment test conducted at the year end, resulted in a write-down of goodwill relating to another wholly owned subsidiary. This was charged to cost of sales.
Group policy is to value non-controlling interests at the date of acquisition at the proportionate share of the fair value of the acquiree’s identifiable assets acquired and liabilities assumed.
2 Depreciation charged to the consolidated profit or loss amounted to $44m. There were no disposals of property, plant and equipment during the year.
3 Other income represents gains on financial assets at fair value through profit or loss. The financial assets are investments in quoted shares. They were purchased shortly before the year end with surplus cash, and were designated at fair through profit loss as they are expected to be sold after the year end. No dividends have yet been received.
4 Included in ‘trade and other payables’ is the $ equivalent of an invoice for 102m shillings for some equipment purchased from a foreign supplier. The asset was invoiced on 5 March 20X6, but had not been paid for at the year end, 31 May 20X6.
Exchange gains or losses on the transaction have been included in administrative expenses. Relevant exchange rates were as follows:
Shillings to $1
5March 20X6 6.8
31 May 20X6 6.0
5 Movement on retained earnings was as follows:
$âm
At 31 May 20X5 165
Total comprehensive income 68
Dividends paid (45)
At 31 May 20X6 188
Required
Prepare a consolidated statement of cash flows for Porter for the year ended 31 May 20X6 in accordance with IAS 7 Statements of cash flows, using the indirect method.
Notes to the statement of cash flows are not required.
Attachments:
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