Question [Foreign subsidiary]

Following are the financial statements of group companies for the year ended June 30, 2020:

Statement of financial position

LP FS
Non-current assets Rs. million $ million
Property, plant and equipment 30,000 200
Investment in FS [$ 160 million] 20,800 -
Current assets
Inventory 4,000 40
Debtors 8,000 20
Cash & bank 3,000 10
65,800 270

Equity
Share capital 25,000 100
Retained earnings 31,000 120
Current liabilities
Creditors 9,800 50
65,800 270

Statement of comprehensive income

LP FS
Rs. million $ million
Sales 35,000 220
Cost of sales (18,000) (130)
Gross profit 17,000 90
Operating cost (4,000) (30)
Exchange gain 1,600 -
Other income 5,000 8
Profit before tax 19,600 68
Tax (4,000) (20)
Profit after tax 15,600 48

Following further information is available:

(1) LP acquired 80% shares of FS on July 1, 2018. At that date the fair values of net assets of FS were equal to the
carrying amounts except for a building which was undervalued by $ 18 million. Its remaining life was 6 years.
At that date fair value of NCI was $ 50 million.

(2) FS paid ordinary dividend of 10% and 20% on January 1, 2019 and January 1, 2020 respectively.

(3) Goodwill was not impaired in 2019 however, it was impaired by $ 5 million at June 30, 2020.

(4) On January 1, 2020 LP sold goods to FS for Rs. 12,500 million invoiced in PKR at a profit margin of 30%. Half of
the amount is still owed by FS on June 30, 2020. Moreover, 40% of these goods are held in FS inventory at year
end. In this respect FS has not yet recorded exchange gain/loss on this foreign currency payable at year end.

(5) FS earned a net profit of $ 40 million for the year ending June 30, 2019.
(6) Following exchange rates are available:

Rs. per $
01-07-18 100
01-01-19 112
30-06-19 120
Average for 2019 116
01-01-20 125
30-06-20 130
Average for 2020 128

Required:
Prepare consolidated statement of financial position and consolidated statement of comprehensive income for the
year ended June 30, 2020.