WEEK 9 Consolidation: non-controlling interest

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Agenda
1.
2.
3.
4.

Discuss the nature of the non-controlling interest (NCI)
Describe full goodwill method and partial goodwill method
Describe how to calculate the NCI share of equity
Prepare worksheet entries for NCI share of equity at acquisition
date
5. Prepare worksheet entries for NCI share of equity subsequent to
acquisition date
6. Explain how the calculation of the NCI is affected by the
existence of intragroup transactions

The nature of NCI

Non-controlling interest explained
Nature of the non-controlling interest (NCI)
• AASB 10 Consolidated Financial Statements, defines non-controlling interest
as:
– “…equity in a subsidiary not attributable, directly or indirectly, to a
parent”
• AASB 10 (para. 22) – NCI:
– Is to be identified and presented within equity, separately from the
parent shareholders’ equity
• As such, NCI
– Is regarded as a contributor of equity to the group
– Is not a liability
– Receives a share of the consolidated equity and therefore participates in
the residual equity of the group
–

Non-controlling interest explained

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