I cannot answer your question since it was not specific (you should give more details)
However I can give you the format to adjust :
If you ask from IS consol point of view, the format is like this :

Profit after tax
Less : unrealised profit of subsidiary
Less : under provision of depreciation of sunsidiary
Add : over provision of depreciation of subsidiary
Revised profit after tax
x
% of NCI.

If you ask from balance sheet point of view :
Net assets of subsidiary at y/e date
+ / (-) adjustments during the year
Revised amount
x
% of NCI

Normally i won't find preference shares in consol I/S since it was irrelevant in arriving to profit for the year. You should disclose more info if you want a more thorough answer to your question.

If your ask from consol B/S point of view the only reason i could think of is the preference share is redeemable which makes it a liability in nature. So in arriving of NCI the liability portion (redeemable preference shares) has to be taken out from equity.

I assume preference dividend is issued out by the subsidiary, and 70% is subscribed by MI, 30% is by the parent company.

Thus, under such circumstances, the point of calculating MI is to find how much of your subsidiary's profits are attributable to MI. (aka in line with how it is financed).

We do not minus ordinary dividend, because any ordinary dividends issued or not is in the same proportions as your share of ownership in the company, so if you DID minus, it would've been the same.

Example:

PAT - 50
Pref div - 10
Ordinary div -10

NET = 30.

Of which, pref dividend * 70% = 7
+ Ordinary dividends of which 20% is paid to MI = 10*20% = 2
+ NET * 20% = 6

= 7 + 2 + 6 = 15.

So, whether u minused or not, it will be the same amount, because that is the amount attributable to them.

We minus preference dividends ONLY, is because it's often subscribed by MI in different proportions to the PARENT"s share of ownership in the subsidiary, whereas ordinary dividends is almost always paid out in the same proportion as the parent's ownership.

I thought Preference dividend for redeemable preference shares falls under finance cost, while irredeemable falls under SOCE?

This post has been edited by karhoe: Nov 24 2008, 07:11 PM

that is true, but in this case, he is trying to calculate the amount paid to MI, in this case, preference dividend needs to be deducted from subsidiary's profits to find the [net profit after preference dividends] = A, and from A * (NCI's share of A) = B

B + Preference dividends * NCI share of pref div = amount of profit attributatble to NCI

Got a question here,
How do you do up the Consolidated Income Statement Cashflow (typo) for a piecemeal acquistion (holding company increasing it's stake in subsidiary company, say 60% to 80%).

This post has been edited by legiwei: Nov 24 2008, 11:55 PM

simple, assume revenue accrue evenly, divide the period into 60% periods, and the 80% period.

say 30/9/X8 they up it to 80% from 60, y/e 31/12/2008, for 9 months, MI has 40%, and for the remaining 3 months, MI has 20%. total MI for the year = Pft for 9 mths * 40% + pft for 3 mths * 20%

(this is standard assumption only la)

anyone got P3 micheal mainwaring tips?

Sorry wrong question, it's Consolidated Cashflow instead of Income Statement, mistyped >.<. Anyway if I'm not mistaken, the above calculation is incorrect (at first I also thought it was ur method) as the pft for the first 9 mths (20% portion )of the MI will go to the calculation of GW for the holding company as he has acquired that additional 20% instead of being included in the MI for the CIS.

P/S : Isn't MI now known as NCI already?

This post has been edited by legiwei: Nov 24 2008, 11:53 PM

anyone study F4(UK) in kaplan financial london bridge,uk?

HI,anyone.. May I know what the diffrent by taking UK tax n MAL tax??

hahaha, yeah.. it is. but i've called it MI for so long I can't help but not call it MI

Examination technique for P3..
which strategy do u all choose?
JUST wanna discuss this so we can share our time management..

Option 1) Answer section A followed by B and B (2 Questions)?
Option 2) Answer section B followed by A and back at B?
Option 3) Answer section B, B and last A?

I think effect of Option 1 is that we can drag a lot of time,and result that we cant finish COMPLETELY in section B
Option 2 i think would be the best,Complete section B, spend time at Section A, and balance would be Section B
Option 3 I think is very least that i can do..

btw; here a little treats for u P3 candidates;

These areas are supportive to the main rational models of strategic planning. They can come out in Section B or part of Section A.

1. Information Technology / Information System
2. Operation
3. Marketing and sales
4. Human resource management
5. Procurement
6. Accounts and finance
7. Quality issues
8. Strategic change management
9. Globalisation
10. Ethics, corporate social responsibility and corporate governance (from P1)
11. Project and project management
12. Business process re-engineering

This post has been edited by HBK-reloaded: Nov 25 2008, 09:57 AM

According to parmindar he recommended student to try this approach :
- finish all section b first preferably in 1hour time (if possible) or within 1.5 hours max.
- after finish section b concentrate remaining hours on section a (a lot of application skills required) since reading and understanding is vital.
- since section a answer can be very general students can quote answer from anywhere (so require some thinking) compared to section b which requires more specific approach.

All in all i don't think P3 is very hard to grasp but the question can be quite ambiguous & there are many different answer to arrive at the conclusion.
For example they may ask like this :
1) How company might change from their old culture to new one ? = Change process management theory (Lewin, greiner, kotter, frech & bell....etc)
2) Where might company might change to accomodate the new changes ? (7s, value chain....etc)

With a difference in just a single wording can change the entire structure of answer (so brain dumping student will normally fail to grasp the question but some lucky ones might get through).

hi guys was hoping if anyone here can provide some tips for p5 p6 and p7?

thanks alot^^

Actually is very hard to recommend for answer Section A or B 1st.

Time mgmt is very important for this paper, if you already spend 1 1/2 hours for Section B, can you still can answer Section A on time? Remember Section A case study 3 pages, you need to do a lot of analysis (That's why this paper call Biz Analysis lo), how long time you will need to take for read and analysis the case?

In Dec 07, I take this paper. I still remember I finish one question in Section B and jump to answer case study, finally go back to Section B answer one more question. But my time mgmt not good, so the final question not answer well, just simply goreng. Lucky Dec 07, the case study very easy and Section B got one question repeat Pilot paper, so may be I earn a lot of marks from that question, so baru can pass la.

My strategy for P3 last sitting was as below:

1) never study AT ALL, never memorize any model/ framework except those basic ones

2) relax and expected to fail the paper

3) go into exam hall, do Section A 1st, analyze the question thoroughly, divide the information into paragraphs

4) answer accordingly and give some real life examples. throw some common sense if possible.

5) continue to Section B. glance through each requirement and eliminate the question which i can't do.

6) repeat step 3 & 4.

7) walk out from exam hall. party cause exam is over!

surprisingly i passed that paper so basically i think P3 is more like a common sense paper. the models/ framework is just to back up your answer. end of the day it is your way of communicating and arguing with the examiner that does matter. and most important, ANSWER ACCORDINGLY.

just my 2 cents, good luck!

roy, u r taking p4 rite? any tips 2 share

yeah. but my lecturer did not give tips. he just pointed out which are the important areas to revise. since you requested for it, i might give it to you as well.

1. business ethics and role, responsibility and ethical conduct of senior financial executives

2. FDI

3. valuation of a company's shares

4. valuation of a company's debts

5. CAPM with effects of changes in gearing

6. M&A

7. Corporate reorganization and capital restructuring

8. foreign exchange risk

9. interest rate risk

10. FOREX modified Black Scholes Model

11. development in financial market - money, capital and derivative market

thx roy, like any other P level subs, it's vy hard to spot. plus so many topics to cover.

I have a friend who passed p3, jun sitting this year..

She managed to passed P3 by not applying any models/framework at all...

What I feel that in passing P3, it depends on your quality of your answers...

This post has been edited by gizmodo: Nov 26 2008, 09:19 AM