Question 1

Financial information for the Ruby group has been provided for the year ended 31 December 2020 as follows in Table 1 and 2 below:

Table 1: Statement of Financial Position as at 31 December	2020	2019
	'000	'000
Non-current Assets
Property, plant and equipment	69,000	60,000
Goodwill	3,000	-
Total Non-current Assets	72,000	60,000
Current Assets
Inventories	24,000	20,000
Receivables	15,500	14,000
Cash	3,500	2,500
Total Current Assets	43,000	36,500
Total Assets	115,000	96,500
Equity and Liabilities
Share capital	12,000	10,000
Share Premium	6,000	5,500
Retained Earnings	61,200	61,300
	79,200	76,800
Non Controlling Interest	1,700	0
Total Equity	80,900	76,800
Non-current Liabilities
Bank Loan	20,000	-
Current Liabilities
Trade Payables	4,100	11,700
Taxation	10,000	8,000
Total Current Liabilities	14,100	19,700
Total Equity and Liabilities	115,000	96,500

Question 1 continues on the next page.

Question 1 continued

Statement of profit or loss for the Ruby group for the year ended 31 December 2020.

Table 1 continued: Consolidated Statement of Profit or Loss	,000
Revenue	44,000
Cost of sales	35,000
Gross profit	9,000
Operating expenses	4,900
Profit before tax	4,100
Taxation	820
Profit for the year	3,280
Attributable to Parent 80%	2,624
Attributable to NCI 20%	656
	3,280

Additional information:

Ruby acquired 80% of the ordinary share capital of Sapphire on 01 June 2020 for 8 million cash plus the issue of 1.5 million 1 ordinary shares. The fair value of the net assets of Sapphire at acquisition were as per Table 2 below;

Table 2: Net Assets On Acquisition	,000
Property Plant and Equipment	6,000
Inventories	2,800
Receivables	1,400
Bank Overdraft	(1,000)
Trade Payables	(800)
Tax	(500)
Net Assets	7,900

• Group policy is to value non-controlling interests at the proportionate share of the fair value of net assets.
• There were no disposals of property, plant and equipment.
• Depreciation charged in the year was 500,000.
• Property, plant, end equipment account does not include additions of 3.5 million occurred during the year.

Required:

1. Prepare the consolidated statement of cash flow for the year ended 31 December 2020. (Prepare the statement in 000s).

[24 marks]