Blavo Ltd (Blavo), a government business entity has acquired two subsidiaries and an associate. The draft statement of financial position for each entity as at 31 May 2020 is as follows:

The following information is relevant to the preparation of the group financial statements:
i) On 1 June 2019, Blavo acquired 80% of the equity interests of Scarlet Ltd (Scarlet), a private entity. The purchase consideration was cash of GH¢300 million. The fair value of the identifiable net assets of Scarlet was GH¢400 million, including any related deferred tax liability arising on acquisition. The owners of Scarlet had to dispose of the entity for tax purposes by a specified date and, therefore, sold the entity to the first company to bid for it, which was Blavo. An independent valuer has stated that the fair value of the non-controlling interest in Scarlet was GH¢86 million on 1 June 2019. Blavo does not wish to measure the non-controlling interest in subsidiaries based on the proportionate interest in the identifiable net assets but hopes to use the ‘full goodwill’ method. The retained earnings of Scarlet were GH¢136 million, and other components of equity were GH¢4 million at the date of acquisition. There had been no new issue of capital by Scarlet since the date of acquisition and the excess of the fair value of the net assets is due to an increase in the value of non-depreciable land.

ii) On 1 June 2018, Blavo acquired 6% of the ordinary shares of Flint Ltd (Flint). Blavo had treated this investment as a financial asset through OCI in the financial statements to 31 May 2019 but had restated the investment at cost on Flint becoming a subsidiary. On 1 June 2019, Blavo acquired a further 64% of the ordinary shares of Flint and gained control of the company. The consideration for the acquisitions was as follows:
.                                                                                Holding                        Consideration

.                                                                                    %                              GH¢’million
1 June 2018                                                                   6                                       10
1 June 2019                                                                  64                                     118
.                                                                                     70                                     128

Under the purchase agreement, on 1 June 2019, Blavo is required to pay the former shareholders 30% of the profits of Flint on 31 May 2021 for each of the financial years to 31 May 2020 and 31 May 2021. The fair value of this arrangement was estimated at GH¢12 million on 1 June 2019, and on 31 May 2020, this value had not changed. This amount has not been included in the financial statements.

On 1 June 2019, the fair value of the equity interest in Flint held by Blavo before the business combination was GH¢15 million. The fair value of the non-controlling interest in Flint was GH¢53 million.

The fair value of the identifiable net assets at 1 June 2019 of Flint was GH¢170 million, and the retained earnings and other components of equity were GH¢55 million and GH¢7 million, respectively. There had been no new issue of share capital by Flint since the date of acquisition, and the excess of the fair value of the net assets is due to an increase in the value of property, plant and equipment (PPE). The fair value of the PPE was provisional pending receipt of the final valuations for these assets. These valuations were received on 1 December 2019, and they resulted in a further increase of GH¢6 million in the fair value of the net assets at the date of acquisition. This increase does not affect the fair value of the non-controlling interest. PPE is depreciated on a straight-line basis over seven years. Ignore any tax implications.

iii) Blavo acquired a 10% interest in Charity Ltd, a government business entity, on 1 June 2018 for GH¢8 million. The investment was accounted for as a financial asset through OCI, and on 31 May 2019, its value was GH¢9 million. On 1 June 2019, Blavo acquired an additional 15% interest in Charity for GH¢11 million and achieved significant influence. Charity made profits after dividends of GH¢6 million and GH¢10 million for the years to 31 May 2019 and 31 May 2020.

iv) On 1 June 2018, Blavo purchased a foreign equity instrument of 11 million dinars at its fair value. The instrument was classified as a financial asset through OCI. The relevant exchange rates and fair values were as follows:

.                                                                   GH¢ to dinars                         Fair value of instrument – dinars million
1 June 2018                                                         4.5                                                                         11
31 May 2019                                                       5.1                                                                         10
31 May 2020                                                       4.8                                                                          7

Blavo has not recorded any change in the value of the instrument since 31 May 2019.
The reduction in fair value as at 31 May 2020 is deemed to be as a result of impairment.

v) There is no impairment of goodwill arising on the acquisitions.

Required:
Prepare a consolidated statement of financial position as at 31 May, 2020 for the Blavo Group.      (20 marks)

The following statements of financial position are as at 31 March 2019:

You are also provided with the following information which will be relevant to the consolidated financial statements of Herd Ltd.
i) At 1 April 2016, the carrying value of the net assets of Swarm Ltd was the same as their fair value, GH¢325 million.

ii) The estimated fair value of the initial investment in 10% of the shares of Swarm Ltd was GH¢40 million at 31 March 2018.

iii) Herd Ltd wishes to use the full fair value method of accounting for the acquisition of Swarm Ltd. At 1 April 2018 the estimated value of the non-controlling interests was GH¢95 million.

iv) The difference between the carrying amount of Swarm Ltd’s net assets and their fair value at the date of acquisition was due to land valued at cost which on 1 April 2018 had a fair value of GH¢25 million in excess of its carrying value. There has been no subsequent significant change in that value.

v) At 1 April 2017 the fair value of Army Ltd’s land was GH¢16 million in excess of its carrying value. There has been no subsequent significant change in that value.

vi) Goodwill arising on acquisition is tested for impairment at each year end. The recoverable amount of goodwill in Swarm Ltd at 31 March 2019 was GH¢30 million.

vii) There has been no impairment of the investment in Army Ltd.

viii) During the year, the Directors of Herd Ltd decided to form a defined benefit pension scheme for its employees. The company contributed cash to it of GH¢250 million but the only accounting entry for this has been to include it in receivables at 31 March 2019.
At 31 March 2019 the following details relate to the pension scheme:
.                                                         GH¢m
Present value of obligation                317
Fair value of plan assets                    302

Required:
Prepare the consolidated statement of financial position of the Herd Ltd group as at 31 March 2019.                           (20 marks)

On 1 October 2016, HO acquired 60% of the equity interest of Sunyani, a public limited company in Ghana. The purchase consideration is made up of cash of GH¢40 million and the fair value of the identifiable net assets acquired was GH¢55 million at that date. The fair value of the non-controlling interest (NCI) in Sunyani was GH¢22.5 million on 1 October 2016.
HO wishes to use the ‘full goodwill’ method for all acquisitions. The share capital and retained earnings of Sunyani were GH¢12.5 million and GH¢32.5 million respectively and other components of equity were GH¢3 million at the date of acquisition. The excess of the fair value of the identifiable net assets at acquisition is due to non- depreciable land. Goodwill has been tested for impairment annually and as at 30 September 2017 had reduced in value by 20%. However, at 30 September 2018, the impairment of goodwill had reversed and goodwill was valued at GH¢1 million above its original value. This upward change in value has already been included in the draft financial statements of HO below prior to the preparation of the group accounts.

The following information is relevant:
i) HO disposed of an 8% equity interest in Sunyani on 30 September, 2018 for a cash consideration of GH¢9 million and had accounted for the gain or loss in other income. The carrying value of the net assets of Sunyani Ltd at 30 September, 2018 was GH¢60 million before any adjustments on consolidation. HO accounts for investments in subsidiaries using IFRS 9 financial instruments and has made an election to show gains and losses in other comprehensive income. The carrying value of the investment in Sunyani was GH¢45 million at 30 September 2017 and GH¢47.5 million at 30 September, 2018 before the disposal of the equity interest.

ii) HO acquired 60% of the equity interest of Kumasi Ltd, a limited liability company also in Ghana on 30 September, 2016. The purchase consideration was cash of GH¢35 million. Kumasi’s identifiable net assets were fair valued at GH¢43 million and the non-controlling interest had a fair value of GH¢14 million at that date. On 1 April 2018, HO disposed off a 40% equity interest in Kumasi for a consideration of GH¢25 million. Kumasi’s identifiable net assets were GH¢45 million and the value of the non-controlling interest was GH¢17 million at the date of disposal. The remaining equity interest was fair valued at GH¢20 million. After the disposal, HO exerts significant influence. Any increase in net assets since acquisition has been reported in profit or loss and the carrying value of the investment in Kumasi had not changed since acquisition. Goodwill had been tested for impairment and found that no impairment was required. No entries had been made in the financial statements of HO for this transaction other than for cash received.

iii) HO sold inventory to Sunyani for GH¢6 million at fair value. HO made a loss on the transaction of GH¢1 million and Sunyani still holds GH¢4 million in inventory at the year end.

iv) On 1 October 2016, HO purchased an item of property, plant and equipment for GH¢6 million and this is being depreciated using the straight line basis over 10 years with a nil residual value. At 30 September 2017, the asset was revalued to GH¢6.5 million but at 30 September 2018, the value of the asset had fallen to GH¢3.5 million. HO uses the revaluation model to value its non-current assets. The effect of the revaluation at 30 September 2018 had not been taken into account in total comprehensive income but depreciation for the year had been charged.

v) On 1 October 2016, HO made an award of 4,000 share options to each of its seven directors. The condition attached to the award was that the directors must remain employed by HO for three years. The fair value of each option at the grant date was GH¢100 and the fair value of each option at 30 September 2018 was GH¢110. At 30 September 2017, it was estimated that three directors would leave before the end of three years. Due to an economic downturn, the estimate of directors who were going to leave was revised to one director at 30 September 2018. The expense for the year as regards the share options had not been included in profit or loss for the current year and no director had left by 30 September 2018.

Required:
Prepare a consolidated statement of profit or loss and other comprehensive income for the year ended 30 September 2018 for the HO group.                                                                                                                                                                          (20 marks)