BKAR 3043 Financial Accounting and Reporting IV

TUTORIAL 4 A212
Submission Date: 28/5/2022

QUESTION 1

Terima Berhad (Terima) is a public listed agriculture company. Its summarised consolidated
financial statements for the year ended 31 March 2021 were as follows:
Terima Berhad
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the year ended 31 March 2021
RM’000
Revenue 108,750
Cost of sales (41,775)
Gross profit 66,975
Gain on disposal of subsidiary 16,000
Other income 39,000
Administrative expenses (48,200)
Other expenses (8,500)
Finance cost (4,000)
Share of results of joint venture 2,000
Share of profit in associate 1,500
Profit before taxation 64,775
Less: Taxation (16,775)
Profit after taxation 48,000
Other comprehensive income
Net change in fair value of equity investments designated at fair 3,000
value through other comprehensive income (“FVOCI”)
Total comprehensive income 51,000

Profit for the year attributable to:

Owners of the company 38,400
Non-controlling interest 9,600
48,000
Total comprehensive income attributable to:
Owners of the company 40,800
Non-controlling interest 10,200
51,000

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 Terima Berhad
Consolidated Statement of Financial Position
As at 31 March
2021 2020
RM’000 RM’000
ASSETS
Non-Current Assets
Property, plant and equipment 77,500 50,250
Right-of-use assets 11,000 9,500
Other investments 12,000 5,000
Intangible assets 200 3,600
Goodwill 9,000 12,000
Joint venture 6,000 4,000
Investment in associate 3,500 4,800
119,200 89,150
Current assets
Biological assets 33,400 12,400
Inventories 15,100 13,800
Trade receivables 74,800 62,900
Cash 31,000 43,370
154,300 132,470
TOTAL ASSETS 273,500 221,620

EQUITY AND LIABILITIES

Equity
Share capital 80,000 80,000
Retained earnings 55,000 20,000
Fair value reserve 8,000 5,000
143,000 105,000
Non-controlling interests 30,000 23,000
173,000 128,000
Non-current liabilities
Long-term loan 51,100 52,700

Current liabilities
Trade payables 12,800 16,300
Interest payable 4,000 5,000
Tax payable 32,600 19,620
49,400 40,920
100,500 93,620
TOTAL EQUITY AND LIABILITIES 273,500 221,620

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Additional information:
1. Depreciation was charged to administration expenses amounting to RM10,500,000
(RM9,500,000 for property, plant and equipment including the bearer plant and the balance
for right-of-use assets).
2. There is impairment loss of RM500,000 for right-of-use assets recorded in the
administration expenses.
3. The impairment loss for goodwill was recognized in the administration expenses.
4. Amortization of intangible assets of RM3,000,000 was charged to administrative expenses.
5. In December 2020, Terima Berhad sold one of its investments in associates valued at
RM3,500,000 for cash consideration of RM4,500,000. The gain of disposal was recorded
in other income.
6. On 13 January 2021, Terima Berhad acquired a 30% interest in DFE Berhad by cash
amounted to RM3,100,000. During the year, DEF Berhad paid dividend to the shareholders
Terima Berhad.
7. In November 2020, Terima Berhad disposed one of its 80 percent ownership subsidiaries,
GRE Berhad for a cash consideration of RM26,800,000. The share price at the time of
disposal was RM4.50. The non-controlling interest was measured at fair value. The details
of the respective account balances at the date of disposal was as follows:

RM’000
Property, plant and equipment 12,100
Inventories 2,800
Trade receivables 7,900
Bank 4,200
Goodwill 2,300
Trade payables 9,500
Share capital at RM1 10,000

8. Biological assets comprised of produce growing on bearer plants. Biological assets are
measured at fair value less costs to sell. Any gains or losses arising from changes in the
fair value less costs to sell are recognised in profit or loss. If gain to use the other income
account and losses to use other expenses account.
9. No disposals of property plant and equipment took place during the year.
10. Terima Berhad paid dividend during the year.

REQUIRED:

Prepare the Consolidated Statement of Cash Flows of Terima Berhad for the year ended 31
March 2021 in accordance with MFRS 107 Statement of Cash Flows using indirect method.
Complete working required for the answers.

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QUESTION 2

Niat Baik Berhad is one of the well-established corporations in Malaysia. Followings are
the consolidated financial statements of Niat Baik Berhad for the year ended 31 December
2021.

Niat Baik Berhad

Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the year ended 31 December 2021
RM’000
Revenue 37,500
Cost of sales (16,710)
Gross profit 20,790
Administrative expenses (9,500)
Other expenses (2,110)
Gain on disposal of subsidiary 1,500
Finance cost (1,000)
Share of profit in associate 250
Profit before taxation 9,930
Less: Taxation (2,480)
Profit after taxation 7,450
Other comprehensive income -
Total comprehensive income 7,450
Profit for the year attributable to:
Owners of the company 5,811
Non-controlling interest 1,639
7,450

Niat Baik Berhad

Consolidated Statement of Financial Position
As at 31 December
2021 2020
RM’000 RM’000
ASSETS
Non-Current Assets
Property, plant and equipment 18,500 16,210
Intangible assets 2,800 3,100
Goodwill 4,000 6,600
Investment in associate 3,950 2,400
29,250 28,310
Current assets
Inventories 9,500 7,450
Trade receivables 14,250 11,300
Cash 29,750 43,370
53,500 62,120
TOTAL ASSETS 82,750 90,430

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 EQUITY AND LIABILITIES
Equity
Share capital 30,000 30,000
Retained earnings 17,800 11,500
47,800 41,500
Non-controlling interests 15,000 20,000
Non-current liabilities
Long-term loan 10,000 12,000
Deferred tax 3,100 2,300
13,100 14,300
Current liabilities
Trade payables 3,640 10,150
Tax payable 3,210 4,480
6,850 14,630
TOTAL EQUITY AND LIABILITIES 82,750 90,430

Additional information:
1. In July 2021, Niat Baik Berhad disposed one of its subsidiaries, Tujuan Ikhlas
Berhad for a cash consideration of RM9,000,000. Niat Baik Berhad acquired
Tujuan Ikhlas Berhad at 85% equity interest in 2011 and the NCI value is a fair
value of RM5,000,000. On the date of disposal, the relevant account balances are as
follows:

RM’000
Property, plant and equipment 8,100
Inventories 2,000
Trade receivables 4,200
Bank 2,000
Goodwill 1,800
Trade payables 5,600

2. During the year, Niat Baik Berhad disposed 15% without losing control of Kanan
Berhad for RM10,000,000. The share of net asset of the effect of change in Kanan
Berhad is RM7,000,000 allocated to NCI and the gain recognized directly in the
retained earnings.
3. In January 2021, Niat Baik Berhad acquired a 40% interest in Kiri Berhad by cash
amounted to RM2,500,000. During the year, Kiri Berhad paid dividend to the
shareholders.
4. Depreciation of property, plant and equipment amounted to RM2,700,000 charged
to administrative expenses. Amortisation of intangible assets was also charged to
administrative expenses.
5. No disposals of property plant and equipment took place during the year.

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6. The impairment loss of goodwill was recognized and charged to administration
expenses
7. Niat Baik Berhad paid dividend during the year.

REQUIRED:

Prepare the Consolidated Statement of Cash Flow of Niat Baik Berhad for the year ended
31 December 2021 in accordance with MFRS 107 Statement of Cash Flows using
indirect method.