at the time of purchasing subsidiary we booked some goodwill in our books of subsidiary.
but now all the fixed assests has been sold and most of the liabilities has been settled only few current assests and current liabilities remaining in subsidiary books along with goodwill.
which is not correct.
how to correct goodwill in books
which ind AS will be applicable
note company shares are unquoted.
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Goodwill written off
Replies (4)
Revaluation of goodwill necessary.
reorganization is necessary. pls send details at contactat @ easyaccountingaudittax.co.in
reorganization is necessary. pls send details at contactat @ easyaccountingaudittax.co.in
Yes. One has to derecognise goodwill as per IndAS 110. This is in the case of full loss of control, the cost of investment will be credited. But if you, say I sold 40% equity but still it is a subsidiary, then
in the parents books you have to subtract Cost of investment in subsidiary from the sales proceeds
Sale proceed xxx
Less cost of investment in S xxx*40%
So, the treatment differs when a subsidiary becomes an associate, JV or completely sold.
So if you can confirm me if complete subsidiary was sold, I can give you the
Para 25(a) - Goodwill to be derecognised.
getdocument (mca.gov.in)
Actually sir only all fixed assests were sold now only few debtors , creditors and equity are available in subsidiary books 100% control is still with us
That means subsidiary shares were never sold to anyone. Goodwill can be impairment tested. If you still hold investment in subsidiary, no need to derecognise goodwill
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