a) The additional 20% purchase by RBE results in an increase in the controlling interest held in the subsidiary, DCA. No further goodwill is calculated on the additional purchase as goodwill is only calculated at the date control was gain in accordance with IFRS 3. However, at the date of additional purchase (1 October 2010) the value of the NCI needs to be established. The proportion “sold” will be transferred from NCI to parent’s equity within the SOCIE. The difference between that value and the consideration transferred is included in parent’s equity as an “adjustment to parent equity” on acquisition. b) Statement of charges in equity for the year ended 31 December 2010 Attributable to NCI Total equity Equity holders of parent $000 $000 $000 Opening balance 3,350 650 4,000 TCI for the year (W1) 1,350 150 1,500 Share issue (2m x $1.30) 2,600 0 2,600 Dividends (200) (30) (W2) (230) Adjustment to NCI for 503 (503) Add. Purchase of DCA Shares (W3) Adjustment to parent’s equity (37) (W3) 0 (37) Balance at the end of the year 7,566 267 7,833 Working 1 $000 NCI share of total comprehensive income of DCA $600,000: NCI at 30% x $600,000 x 9/12 months 135 NCI at 10% x $600,000 x 3/12 months 15 NCI share of TCI 150 Therefore parent share of TCI of DCA is $600,000 - $150,000 = $450,000 Total TCI attributable to equity holders of Parent is $900,000 + $450,000 = $1,350,000. Working 2 NCI share of dividend paid April 2010 by DCA = 30% x $100,000 = $30,000 Working 3 Value of NCI at 1 October 2010 is $650,000 + $135,000 (W1) - $30,000 (W2) = $755,000.

Therefore the value transferred is $755,000 x 2/3 = $503,333 Adjustment to parent’s equity $000 Consideration transferred 540 Value on non-controlling interest transferred (503) Adjustment to parent equity 37