Illustrative examples (AASB107_08-15_ACOMPsep24_01-27) (FP)

The examples show only current period amounts. Comparative information for the preceding period is required to be presented in accordance with AASB 18 Presentation and Disclosure in Financial Statements.

Information from the statement of comprehensive income and statement of financial position is provided to show how the statements of cash flows under the direct method and indirect method have been derived. Neither the statement of comprehensive income nor the statement of financial position is presented in conformity with the disclosure and presentation requirements of other Standards.

The following additional information is also relevant for the preparation of the statements of cash flows:

•                all of the shares of a subsidiary were acquired for 590. The fair values of assets acquired and liabilities assumed were as follows:

•                250 was raised from the issue of share capital and a further 250 was raised from long-term borrowings.

•                interest expense was 400, of which 170 was paid during the period. Also, 100 relating to interest expense of the prior period was paid during the period.

•                dividends paid were 1,200.

•                the liability for tax at the beginning and end of the period was 1,000 and 400 respectively. During the period, a further 200 tax was provided for. Withholding tax on dividends received amounted to 100.

•                during the period, the group acquired property, plant and equipment and right-of-use assets relating to property, plant and equipment with an aggregate cost of 1,250, of which 900 related to right-of-use assets. Cash payments of 350 were made to purchase property, plant and equipment.

•                depreciation on property, plant and equipment and amortisation of intangible assets for the period amounted to 350 and 100 respectively.

•                plant with original cost of 80 and accumulated depreciation of 60 was sold for 20.

•                trade and other receivables as at the end of 20X2 include 100 of interest receivable.

A. Obtaining control of subsidiary

During the period the Group obtained control of Subsidiary X. The fair values of assets acquired and liabilities assumed were as follows:

B. Property, plant and equipment

During the period, the Group acquired property, plant and equipment and right-of-use assets relating to property, plant and equipment with an aggregate cost of 1,250, of which 900 related to right-of-use assets. Cash payments of 350 were made to purchase property, plant and equipment.

C. Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and balances with banks, and investments in money market instruments. Cash and cash equivalents included in the statement of cash flows comprise the following amounts in the statement of financial position:

Cash and cash equivalents at the end of the period include deposits with banks of 100 held by a subsidiary which are not freely remissible to the holding company because of currency exchange restrictions.

The Group has undrawn borrowing facilities of 2,000 of which 700 may be used only for future expansion.

D. Segment information

E. Reconciliation of liabilities arising from financing activities

Alternative presentation (indirect method)

As an alternative, in an indirect method statement of cash flows, operating profit before working capital changes is sometimes presented as follows:

The example shows only current period amounts. Comparative information for the preceding period is required to be presented in accordance with AASB 18 Presentation and Disclosure in Financial Statements.

The example is presented using the direct method.

This example illustrates one possible way of providing the disclosures required by paragraphs 44A–44E.

The example shows only current period amounts. Comparative information for the preceding period is required to be presented in accordance with AASB 18 Presentation and Disclosure in Financial Statements.