Consolidation & Group Accounting: Goodwill, NCI & Intercompany Eliminations

What you'll build

What you will be able to do

Each lab ends with a concrete result that you build yourself and the checker confirms, cell by cell.

• Map the Harlow Industries group, work out the effective ownership and the non-controlling interest of an indirect subsidiary, and decide whether a company held through two routes is a subsidiary.
• Measure the consideration Harlow paid for 80 % of Fenwick Foods, the identifiable net assets at fair value, and goodwill with the NCI measured both ways.
• Turn the fair value uplifts from the acquisition into extra depreciation and amortisation, adjust Fenwick’s profit for the group and split its post-acquisition retained earnings.
• Build Harlow’s consolidated balance sheet at 31 Dec 2026 two years after the acquisition: fair value uplifts, group retained earnings and the NCI, with a check that the balance sheet balances.
• Eliminate the trading between Harlow and Fenwick in both directions, measure the unrealised profit with a mark-up and with a margin, and work out the part the NCI bears.
• Reconcile the balances between Harlow and Fenwick, fix the cash in transit, and eliminate the intercompany loan, its interest and Fenwick’s dividend to Harlow.
• Adjust each company’s 2026 profit for the consolidation entries, split the group profit between the owners of Harlow and the NCI of Fenwick and Garnet, roll the NCI forward and chart who gets the profit.
• Account for Harlow’s 30 % associate Ridgeway with the equity method, then take control of it in a step acquisition: remeasurement gain, goodwill and the new group equity in a chart.