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Answer 1

Cash flows from operating activities $000 $000

Net loss before tax 16,500Adjustments for:

Depreciation 5,800

mpairment losses !" "#0

6,0#0

"",5#0

ncrease in trade receiables %&,800 ' (,500 ' 600) %1,(00)

ncrease in inentories %16,000 ' 10,000 ' 1,600) %#,#00)

ncrease in trade pa*ables %(,600 ' 6,100 ' +00) 1,"00

Cash generated from operations 1(,6#0

ncome taxes paid !+ %#,"00)

Net cash inflows from operating activities 1+,##0Cash flows from investing activities

Acuisition of subsidiar* net of cas- acuired %600)

.urc-ase of propert*, plant and euipment !1 %1+,100)

Net cash used in investing activities %1+,(00)

Cash flows from financing activities

.roceeds from issue of s-are capital

/1",+00 5,800 ' 10,000 ' ",000 ' %5,000 ' 1,000) ",100

Diidend paid %&00)

Diidend paid to N2 !# %#0)

Net cash used in financing activities 1,160

Net decrease in cash and cash equivalents &00Cash and cash equivalents at beginning of year 1,500

Cash and cash equivalents at end of year ",#00

ABC Group

Statement of cash flows for the year ended 31 ecember !"1!

#or$ings%

#1

$000 $000

3al4 bd "5,000 Depreciation 5,800ealuation surplus 500

7n acuisition ",(00

Additions %bal4 fi4) 1+,100 3al4 cd +5,500

#1,+00 #1,+00

.ropert*, plant and euipment

1&"

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#!

$m $m

3al4 bd ' mpairment loss "#0

7n acuisition /5,000 %#,800 x +09) ' #,800 1,6#0 3al4 cd 1,#001,6#0 1,6#0

oodwill

#3

$m $m

3al4 bd #,000

ncome taxes paid %bal4 fi4) #,"00 Acuistion "00

3al4 cd 5,"00 .; 5,"00

&,#00 &,#00

#&

$m $m

3al4 bd '

Diidend paid #0 Acuisition %#,600 x +09) 1,##0

3al4 cd 1,(50

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Answer !

$m $m

Cash flows from operating activities.rofit before taxation 5&400

Adjustments for:

Depreciation %i) "(400

mpairment of oodwill !1 +1450

Amortisation !" 1(400

.rofit on exc-ane on land %15 # ' 10) %&400)

ain on inestment propert* !# %1450)

;oss on replacement of inestment propert* 0450

ain on realuation of inestment in euit* instruments

%

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#or$ings%

1&5

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#1 Goodwill ) *igret $m $m

2onsideration %15m 15m) +0400

@ of N2 "0400

@ of preiousl* -eld euit* interest 5400

55400

;ess:

dentifiable net assets %15 18 5 () #5400

Deferred tax %#5m ' #0m) x +09 %1450)

%#+450)

oodwill 11450

$m $m

3al4 bd 68400 mpairment loss %bal4 fi4) +1450Ac4 of

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#,

$m $m

3al4 bd "5#400 ;oss on realuation %72) (400

Ac4 of sub4 15400 ;and exc-aned %N3) 10400

New plant exc-ane #400 Depreciation "(400

Additions %bal4 fi4) &8400 3al4 cd +"(400

+(1400 +(1400

#-

$m $m

3al4 bd ' Diidend receied '

.rofit or loss 6400

Acuisition %bal4 fi4) #8400 3al4 cd 5#400

5#400 5#400

#.

$m $m

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b2i2

se of the indirect method of preparing statements of cash flow

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oin to be used4

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Answer 3

a2

Cash flows from operating activities $m $m

.rofit before tax 680

Adjustments for:

nterest expense #0

=-are of profit of associate %"0)

Depreciation 60

mpairment of oodwill !" 8

etirement benefit expense %non'cas- item) 1+

101

(81

Decrease in inentories %680 ' 580 ' &0) "0

ncrease in receiables %610 ' 5+0) %80)

ncrease in trade pa*ables %1,+#1 ' 1,"00) 1#1

Cash generated from operations 86"

etirement benefit contributions %()

nterest paid !6 %+1)

ncome taxes paid !( %1&0)

Net cash inflows from operating activities 6+#

Cash flows from investing activities

.urc-ases of ..? !1 %"51)

.urc-ase of subsidiar* %100)

Diidend receied from associate !# +5

nestment in ier %#00)

Net cash used in investing activities %(16)

Cash flows from financing activities

.roceeds from issue of s-are capital +0

ncrease in loans %6"1 ' 555) 66

Diidend paid !8 %#6)

Diidend paid to N2 !5 %58)

Net cash used in financing activities %8)

Net decrease in cash and cash equivalents %&0)

Cash and cash equivalents at beginning of year 1#0

Cash and cash equivalents at end of year 50

4ambe5e Group

Statement of cash flows for the year ended 3" (une !""-

"00

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b2

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Applying the above criteria to 4ambe5e:s relationship with ;iver%

Iambee -as power to oern t-e financial and operatin policies of ier, t-rou- its operatin

uidelines4 t also -as t-e power to pro-ibit t-e inestment manaer from profitin personall* from t-e

inestments4 Iambee is exposed to and -as ri-ts to ariable returns from its inestment in ier, as

it receies &59 of t-e profits and 1009 of t-e losses of ier4

Iambee t-erefore controls ier, and ier s-ould be consolidated4

c2

7thical behavior in t-e preparation of financial statements, and in ot-er areas, is of paramount

importance4

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Answers

Answer &

a2

Cash flows from operating activities $m $m

Net loss before tax %#()

Adjustments for:

nterest expense &

=-are of profit of associate %6)

Depreciation !1 +6

.rofit on disposal of propert*, plant and euipment %6+ ' 56) %()

.rofit on insurance claim %+ ' 1) %")

@orein exc-ane loss %141 048+) !" "

mpairement losses %"0 1") +"

ain on realuation of inestment in euit* instruments !6 %()etirement benefit expense %non'cas- item) %ii) 10

6(

"0

Decrease in inentories %1&8 ' 1+5) 6+

Decrease in receiables %16+ ' &") (1

Decrease in trade pa*ables %115 ' 180 ' "048+ %!")) %86)

Cash generated from operations 68

etirement benefit contributions %ii) %10)

nterest paid !( %8)

ncome taxes paid !8 %+&)

Net cash inflows from operating activities 11

Cash flows from investing activities

.urc-ases of ..? /56 %!1) 141 %!") %5()

.roceeds from sale of ..? %iii) 6+

.roceeds from sale of inestments in euit* instruments %i) #5

Acuisition of associate !5 %&6)

Diidend receied from associate !5 "

Net cash used in investing activities %#+)

Cash flows from financing activities

.roceeds from issue of s-are capital %650 ' 5&5) 55

epa*ment of lon'term borrowins %"0 ' 6#) %##)Diidend paid %statement of c-anes in euit*) %&)

Diidend paid to N2 !& %5)

Net cash used in financing activities %+)

Net decrease in cash and cash equivalents %+5)

Cash and cash equivalents at beginning of year +"+

Cash and cash equivalents at end of year "88

#arrburt Group

Statement of cash flows for the year ended 3" November !""/

"0+

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#or$ings%

#1

$m $m

3al4 bd +60 Disposals 56ains on propert* realuation # Depreciation +6

eplacement asset from insurnace co4 + Asset destro*ed 1

Additions %forein) ' credit %1005) %iii) "0 3al4 cd +50

Additions %forein) ' cas- %"805) %iii) 56

##+ ##+

#! 78change loss

At +0 Kune "008 r=

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#,

$m $m

3al4 bd ' Diidend receied %8 x "59) %i) "

=-are of profit of associate %i) 6 3al4 cd 100.urc-ase of associate %bal4 fi4) &6

10" 10"

#-

$m $m

3al4 bd 150 Disposal at fair alue %i) #5

@air alue ain on inestment in Alb %i) (

72 %i) +0 3al4 cd 1#"

18( 18(

#.

$m $m

nterest paid %bal4 fi4) 8 3al4 bd #

3al4 cd 5 .rofit or loss &

1+ 1+

#/

$m $m

ncome taxes paid %bal4 fi4) +& 3al4 bd %current) #"

3al4 bd %deferred) "6

.rofit or loss "&

3al4 cd %current) +5 72 ' ? %i) +

3al4 cd %deferred) "8 72 ' ..? %ii) "

10" 10"

#0

$m $m

Diidend paid %bal4 fi4) 5 3al4 bd 5+

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t-is4 Alt-ou- !arrburt -as made a loss before tax of $"+m, net cas- from operatin actiities is a

modest but -ealt-* $11m4 3efore worHin capital c-anes, t-e cas- enerated is $"0m4

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Answers

reulations are supported b* a number of codes, for example, on corporate oernance w-ic- assist

accountants in maHin et-ical decisions4