The following are individual statements of financial position as at 31 March 2020 of Universe plc and its subsidiary Galaxy plc:
| Universe plc Galaxy plc | |||
| £’000 | £’000 £’000 | £’000 | |
| Assets | |||
| Non-current assets | |||
| Property, plant and equipment | 968,750 | 512,500 | |
| Investment in Galaxy | 472,500 | – | |
| 1,441,250 | 512,500 | ||
| Current assets | |||
| Inventories | 151,200 | 84,150 | |
| Trade receivables | 101,250 | 61,875 | |
| Current account with Galaxy | 45,000 | – | |
| Cash and cash equivalents | 20,790 | 15,975 | |
| 318,240 | 162,000 | ||
| Total assets | 1,759,490 | 674,500 | |
| Equity and Liabilities | |||
| Equity | |||
| Ordinary shares £1 each | 800,000 | 350,000 | |
| Retained earnings | 205,200 | 164,750 | |
| 1,005,200 | 514,750 | ||
| Long-term liabilities | 346,500 | 15,000 | |
| Current liabilities | |||
| Trade payables | 113,190 | 77,440 | |
| Current account with Universe | – | 45,000 | |
| Other current liabilities | 294,600 | 22,310 | |
| 407,790 | 144,750 | ||
| Total equity and liabilities | 1,759,490 | 674,500 | |
The following information is relevant:
- Universe plc acquired 280,000,000 ordinary shares in Galaxy plc for £472,500,000 on 1 April 2019. At the date of acquisition, the ordinary shares and the retained earnings of Galaxy plc were £350,000,000 and £108,500,000 respectively.
- On 1 April 2019, a fair value exercise was carried out and it was determined that the fair value of Galaxy plc’s property, plant and equipment was £50,000,000 greater than their carrying values. These assets had remaining useful economic lives of 8 years on 1 April 2019. The group policy is to charge straight-line depreciation on the property, plant and equipment with no residual value. Galaxy plc has not adjusted its accounts to reflect the fair value exercise.
- During the year ended 31 March 2020, Universe plc sold goods to Galaxy plc for £45,000,000 at a mark-up of 20% on cost. 75% of these goods remained in Galaxy plc’s inventory on 31 March 2020.
- The impairment test showed that the goodwill arising on the acquisition of Galaxy plc was impaired by £12,000,000 on 31 March 2020.
- It is group policy to value the non-controlling interest at fair value at the date of acquisition.
- The fair value of the non-controlling interest in Galaxy plc at the date of acquisition was £125,000,000.
Required:
Prepare the consolidated statement of financial position for the Universe group as at 31 March 2020.
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