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When the acquirer measures NCI at the FAIR VALUE method vs the PROPORTIONATE method, the differences flow through:
AGoodwill (FV method usually yields higher goodwill because the NCI 'gets its share' of goodwill); subsequent impairment of the goodwill — and hence P&L — may also differ
BNet assets only
COCI only
DRetained earnings
Answer & Solution
Correct answer: A. Goodwill (FV method usually yields higher goodwill because the NCI 'gets its share' of goodwill); subsequent impairment of the goodwill — and hence P&L — may also differ
FV-method NCI implicitly attributes goodwill to NCI's share, raising total goodwill (and thus the impairment ceiling) compared to the proportionate method. Subsequent impairment under Ind AS 36 therefore differs by method.
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