Consolidation

worksheet ON
ACQUISITION DATE
Hana Cahyaningrum & Intan Sari Pradini

This is where your presentation begins

 Notes!
 Obligation composing report finance consolidation appear since happening connection parent-child
 Ondate acquisition,only balance sheet consolidation which could served. Profit make a loss entity
parent and child only could consolidated based on announcement profit and loss entity child on period
after connection parent-child
 Compilation paper work consolidation will more accurate if done elimination on every account
intercompany more formerly
 Account intercompany originated from transaction intercompany (entity parent with child)
 Mark reasonable entity child on date acquisition should taken into account in report consolidation
 difference investation undervalued and asset no form (goodwill andother) should added on asset
consolidation,
 whereas difference investation consequence overvalued should reduce asset or add debt consolidation
so that report consolidation describe Mark reasonable
 Description (in millions) PT Intiseka PT Andaika
Cash IDR 1,200,000 IDR 750.000
Accounts receivable IDR 1,000,000 IDR 1,250,000
Supply IDR 2,000,000 IDR 1,500,000
Building IDR 4,200,000 IDR 3,500,000
Land IDR 6,000,000 IDR 2,000,000
Investment in shares of PT Andaika IDR 5,600,000
Total assets IDR 20,000,000 IDR 9,000,000
Accounts payable IDR 2,000,000 IDR 500,000
bank debt IDR 4,000,000 IDR 2,000,000
Capital stock IDR 10,000,000 IDR 5,000,000
Share premium IDR 2,000,000 IDR 500,000
Retained earning IDR 2,000,000 IDR 1,000,000
Totalliabilities/obligation IDR 20,000,000 IDR 9,000,000

Goodwill in debit for add Mark assets on report consolidation, where as difference overvalued
credited for reduce Mark assets/add debt consolidation. Journal elimination on paper work
consolidation as following:
 Capital stock IDR 5,000,000,000
Share premium IDR 500,000,000
Retained earning IDR 1,000,000,000
Building IDR 500,000,000
Land IDR 800,000,000
goodwill IDR 200,000,000
Accounts receivable IDR 500,000,000
Supply IDR 350,000,000
Tax debt IDR 150,000,000
Investation IDR 5,600,000,000
Non-controlling interests IDR 1,400,000,000

Based on PSAK 22 revision 2010 interest non-control based on Mark reasonable according to evaluation
independent. Including goodwill too allocated to interest non-controlling. In case on goodwill for interest non-
controlling is 1.4billion (20% from Mark reasonable PT Andaika)
Calculation: = 20% x 6.8 billion (Mark reasonable) + 20% x 200
million (goodwill that allocated)
= 1.36 billion + 40 million
= 1.4 Billion
 Working paper of the consolidated balance sheet of PT Intiseka and its subsidiaries as of 1/1/2012
elimination
Assets PT Intiseka PT Andaika Consolidated Balance
debit Credit

Cash IDR 1,200,000 IDR 750.000 Rp 1.950.000

Accounts receivable IDR 1,000,000 IDR 1,250,000 IDR 500,000 IDR 1,750,000

Supply IDR 2,000,000 IDR 1,500,000 IDR 350.000 IDR 3,150,000

Building IDR 4,200,000 IDR 3,500,000 IDR 500,000 IDR 8,200,000

Land IDR 6,000,000 IDR 2,000,000 IDR 800,000 IDR 8,800,000

Investment in shares of PT Andaika IDR 5,600,000 IDR 5,600,000 Rp -

goodwill IDR 200,000 IDR 200,000

Total assets IDR 20,000,000 IDR 9,000,000 IDR 24,050,000

Tax debt IDR 150.000 IDR 150.000

Accounts payable IDR 2,000,000 IDR 500,000 IDR 2,500,000

bank debt IDR 4,000,000 IDR 2,000,000 IDR 6,000,000

Share capital (nominal 1,000) IDR 10,000,000 IDR 5,000,000 IDR 5,000,000 IDR 10,000,000

Share premium IDR 2,000,000 IDR 500,000 IDR 500,000 IDR 2,000,000

Retained earning IDR 2,000,000 IDR 1,000,000 IDR 1,000,000 IDR 2,000,000

Non-controlling interests IDR 1,400,000 IDR 1,400,000

Total liabilities/liabilities IDR 20,000,000 IDR 9,000,000 IDR 8,000,000 IDR 8,000,000 IDR 24,050,000
 WORKING PAPERS - PROFIT-LOSS,
REFUNDED PROFIT,
CONSOLIDATED BALANCE FOR THE
YEAR OF ACQUISITION
Connection parent-child after date acquisition give right on entity parent on profit entity child.
In profit make a loss parent that is account income investation on entity child.
Suppose on year2012 PT Andaika announce profit in report finance as big as Rp200 million and
dividend as big as Rp100 million. On announcement report finance the, PT Intiseka adapt Mark
the investment because profit entity child show development investation parent. income
investation PT Intiseka on share PT Andaika year2012 is Rp390 million, that is as following:

Investee's profit (80% x IDR 200 million) IDR 160,000,000

Amortization of investment difference

Overvalued inventory IDR 280,000,000

Undervalued building -Rp 40,000,000

Goodwill (80% x 12.5 million) -Rp 10,000,000

Total income IDR 390.000.000

 Consolidated financial statements 12/31/2012 (in
thousands)
Description PT Intiseka PT Andaika
Statement of Profit and Loss and Retained Earnings:
Sale IDR 1,500,000 IDR 1,000,000
Income from PT Andaika IDR 390,000
Journal
HPP -Rp 690,000 -Rp 600,000
Investation in share IDR 390.000.000
Operating load -Rp 300,000 -Rp 200,000
Net profit IDR 900,000 IDR 200,000
Income Investation IDR 390.000.000
Retained earnings January 1, 2012 IDR 2,000,000 IDR 1,000,000
Dividend -Rp 400,000 -Rp 100.000
Balance Sheet: IDR 2,500,000 IDR 1,100,000
Cash IDR 510,000 IDR 550.000
Income investation Upgrade Mark investation where as
Dividend Receivable IDR 80,000 dividend which received deduction Mark investation so
Accounts receivable IDR 1,000,000 IDR 1,500,000
that Mark investation lowered as big as dividend which
Supply IDR 1,500,000 IDR 2.150.000
Investment in shares of PT Andaika IDR 5,910,000 received
Building IDR 4,000,000 IDR 3,150,000
Land IDR 6,000,000 IDR 2,000,000 Journal
Total assets IDR 19,000,000 IDR 9,350,000
dividend payable IDR 100,000 Receivables dividend (80% x 100million) 80,000,000
Tax debt IDR 150.000
Accounts payable IDR 1,500,000 IDR 500,000 Investation in share 80,000,000
bank debt IDR 3,000,000 IDR 2,000,000
Share capital (nominal 1,000) IDR 10,000,000 IDR 5,000,000
Share premium IDR 2,000,000 IDR 500,000
Retained earning IDR 2,500,000 IDR 1,100,000
Total liabilities/liabilities IDR 19,000,000 IDR 9,350,000
Mark investation on date 31/12/2012 experience increase as big as Rp310 million, which originated
from increase income investation as big as Rp390 million and drop Mark investation consequence
dividend as big as Rp 80 million. Ascension as big as Rp 310 million this causing Mark investation the
one on date 1 January 2012 amount Rp5,6 billion Becomes Rp5,91 billion on date 31/12/2012.
Income investation as big as Rp 390 million and Mark investation as big as Rp5,910,000,000 served in
report finance PT Intiseka as of 31/12/2012. Profit individual PT Intiseka on year 2012 is Rp510
million, so that profit total Becomes: Rp510 million + IDR 390 million= Rp900 million.
If entity parent no have 100% control entity child, report consolidation should serve interest non-
controlling alone on side equity consolidation in accordance provision PSAK 4 revision 2009 for show
part which no mastered entity parent. Profit entity child also should allocated 20% to interest non-
controlling,that is Rp40 million (20% x Rp200 million) which add balance interest non-controlling. Will
but,total profit which allocated on interest non-controlling should customized with change difference
reasonable and goodwill PT Andaika. Profit interest non-controlling PT Andaika calculated as
following:
 Investee's profit (20% x IDR 200 million) IDR 40,000,000
Amortization difference investation
Inventory overvalue (0.2 x 350 million) IDR 70,000,000
Building undervalue (0.2 x 500 million/10) -Rp 10,000,000
Goodwill (20% x 12.5million) -Rp 2,500,000
Profit of non-controlling interest IDR 97,500,000

Interest non-controlling also get right on dividend as big as 20% or Rp20 million. With thus, remainder profit which no
shared as big as Rp77.5 million will add balance interest non-controlling.
Connection parent-child after date acquisition oblige entity parent compile report finance consolidation complete
which consist from Report Profit and loss and Profit Detained consolidation, balance Consolidation,as well as Current
Cash Consolidation. display 4-5 serve paper work consolidation PT Intiseka and PT Andaika on date 31 December 2012.
Paper work the consist from report profit and loss, profit detained, and balance sheet individual entity parent as well as
child which sourced from display 4-4. There is a number of account intercompany which should eliminated in paper
work consolidation that.
1. Income from Entity Child (Parent) and Profit which Shared (Child)
Income investation as big as Rp390 million which recorded in bookkeeping entity parent is income which originated
from entity child,so that should eliminated. Against from income from entity child is profit which shared by entity child
 Consolidation Working Paper
PT Intiseka and its subsidiary PT Andaika
as of 12/31/2012
elimination
Description (in thousands) PT Intiseka PT Andaika Consolidated Balance
debit Credit
Income statement
Sale IDR 1,500,000 IDR 1,000,000 IDR 2,500,000
Income from PT Andaika IDR 390,000 IDR 390,000 Rp -
HPP -Rp 690,000 -Rp 600,000 IDR 350.000 -Rp 940,000
Operating load -Rp 300,000 -Rp 200,000 IDR 62,500 -Rp 562,500
Profit of non-controlling interest IDR 97,500 -Rp 97,500

Net profit IDR 900,000 IDR 200,000 IDR 900,000

Retained earnings 1/1/2012 IDR 2,000,000 IDR 1,000,000 IDR 1,000,000 IDR 2,000,000
Dividend -Rp 400,000 -Rp 100.000 IDR 80,000 -Rp 400,000
IDR 20,000
Retained earnings 12/31/2012 IDR 2,500,000 IDR 1,100,000 IDR 2,500,000
balance
Cash IDR 510,000 IDR 550.000 IDR 1,060,000
Dividend Receivable IDR 80,000 IDR 80,000 Rp -
Accounts receivable IDR 1,000,000 IDR 1,500,000 IDR 500,000 IDR 2,000,000
Supply IDR 1,500,000 IDR 2.150.000 IDR 350.000 IDR 350.000 IDR 3,650,000
Investment in shares of PT Andaika IDR 5,910,000 IDR 310,000
IDR 5,600,000
Building IDR 4,000,000 IDR 3,150,000 IDR 500,000 IDR 50,000 IDR 7,600,000
Land IDR 6,000,000 IDR 2,000,000 IDR 800,000 IDR 8,800,000
goodwill IDR 200,000 Rp 12,500 IDR 187,500
Total assets IDR 19,000,000 IDR 9,350,000 IDR 23,297,500
dividend payable IDR 100,000 IDR 80,000 IDR 20,000
Tax debt IDR 150.000 IDR 150.000 IDR 300,000
Accounts payable IDR 1,500,000 IDR 500,000 IDR 2,000,000
bank debt IDR 3,000,000 IDR 2,000,000 IDR 5,000,000
Share capital (nominal 1,000) IDR 10,000,000 IDR 5,000,000 IDR 5,000,000 IDR 10,000,000
Share premium IDR 2,000,000 IDR 500,000 IDR 500,000 IDR 2,000,000
Retained earning IDR 2,500,000 IDR 1,100,000 IDR 2,500,000
Non-controlling interests IDR 77,500
IDR 1,400,000 Rp 1,477,500
Total liabilities IDR 19,000,000 IDR 9,350,000 IDR 8,980,000 IDR 8,980,000 IDR 75,792,500
Entity child announce dividend 100 million so that right entity parent is 80 million
Journal elimination
Income from entity child IDR 390million
Dividend IDR 80million
Investation 310million

Credit investation as big as 310 million showing elimination increase Mark investation because
income investation more big from dividend which announced entity child. When PT Andaika no
announce dividend so journal the elimination income investation eliminated with credit investation
in share 390million.

2. Allocation Profit Interest Non-controlling

Paper work should disclose profit interest non-controlling as following:
Profit Interest Non-controlling IDR 97.5million
Dividend IDR 20million
Interest Non-controlling IDR 77.5million
3.Balance Beginning Investation with Riches Entity Child
After elimination income (number1) whore duce investation,still there is balance investation in report
finance entity parent (PT Intiseka) as big as IDR 5,91 billion - IDR 310 million=IDR 5,6 billion, where total
that is Mark investation beginning (1/1/2012), where as Mark investation which has eliminated previously
as big asRp310million is increase investation During year walk. So,elimination income investation will
leaving Mark investationon balance beginning year. In case this,balance beginning year also is date
acquisition. Account investation entity parent in share entity child is account which related with riches
holder share entity child which consist from account capital share,account agio share, and account profit
detained.Mark investation beginning should eliminated with riches entity child beginning year,or on time
which same with date investationso that there is equality.Riches holder share entity child on beginning
year is Rp6.5 billion which consist from capital share Rp5 billion, agio share Rp500 million, and profit
detained 1January Rp1 billion. Journal the elimination is as following:
Capital share IDR 5,000,000,000
Agio share IDR 500,000,000
Profit detained 1January IDR 1,000,000,000
Difference investation IDR 500,000,000
Investation in share IDR 5,600,000,000
Interest non-controlling IDR 1,400,000,000
 Difference investation and Mark book riches entity child on beginning year as big
as Rp500 million served so that Mark investation balanced with Mark riches which
eliminated. Difference investation 500 million could direct allocated to account
which causing difference concerned with journal following:
Capital share IDR 5,000,000,000
Agio share IDR 500,000,000
Profit detained1January 1,000,000,000
Building 500,000,000
land 800,000,000
Goodwill 200,000,000
Investation in share IDR 5,600,000,000
Interest non-controlling 1,400,000,000
Receivables 500,000,000
Inventory 350,000,000
tax payable 150,000,000

Paper work on display 4-5 serve journal which second

4. Amortization and Impairment Difference Investation
inventory which causing overvalued 350 million has for sale by PT Andaika, so that should
amortized. In income investation entity parent, amortization overvalued will add income
investation. Because paper work consolidation for knowing profit consolidation so
amortization overvalued could reduce expense the one on finally add profit.
Amortization overvalued inventory treated as subtractor COGS because inventory part from
COGS. Undervalue building also should amortized because assets the should zero in
accordance his age. Undervalue building 50 million/year. Decrease value goodwill 12.5
million treated as increase Operational Expense
Journal
Inventory IDR 350,000,000
Operational Expense IDR 62,500,000
COGS IDR 350,000,000
Building IDR 50,000,000
Goodwill IDR 12,500,000
5. Debt accounts receivable in connection with dividend which announced entity
child
Dividend which announced 100 million not yet paid so that arise debt dividend.
Entity parent entitled on 80% dividend child in accordance percentage ownership
share.So that on report finance entity parent there is accounts receivable dividend
80 million. Debt accounts receivable this including in account intercompany so that
should eliminated
Journal
Dividend Payable IDR 80million
Receivables dividend IDR 80million

Profit and loss Consolidation

After entity child announce profit, so net profit entity parent is profit individual
added with income investation.
Net Profit Parent=Profit individual+Income investation.
Profit individual PT Intiseka year 2012 is Rp510 million and income investation
Rp390 million so that profit clean Becomes Rp900 million. For PT Intiseka, profit
clean this is profit combined or profit consolidation.
Net Profit Parent=Profit Consolidation
Profit consolidation which generated from paper work if component income investation only
originated from profit entity child (no there is amortization difference investation) on basic is:
Profit consolidation =Profit parent+ Profit child -Profit interest non-controlling
If income investation influenced by amortization difference investation,so profit consolidation
calculated as following:
parent profit xxxx
Amortization of investment difference xxxx
child profit (xxxx)
Profit interest non-controlling xxxx
Consolidated Profit

Profit consolidation as big as Rp900 million generated as following:

Parent entity's individual profit IDR 510,000,000
Amortization of investment difference
Inventory IDR 350,000,000
Building -Rp 50,000,000
goodwill -Rp 12,500,000 IDR 287,500,000
Subsidiary's profit IDR 200,000,000
Profit of non-controlling interest -Rp 97,500,000
Consolidated Profit IDR 900,000,000
 THANKS!
Does anyone have any questions?