Accounting for Groups

This subject presents the methods used to account for corporate groups.  Corporate groups may be structured through investments in other entities, which will lead to a number of accounting techniques that may be appropriate in certain circumstances. Depending on the level of control that is exerted by the investor, the investment might be classified as either a subsidiary of the parent, an associate or a joint venture/arrangement. The financial reporting required by Australian Accounting Standards varies with these types of arrangements.  The preparation of consolidated financial statements for corporate groups, including the treatment of goodwill, intra-group transactions and non-controlling interests are considered in depth, as are equity accounting and proportional consolidation. Other advanced topics investigated include segment disclosures, related party disclosures, and foreign currency translation.  The subject also critically evaluates group accounting, the quality of information produced for users, current issues in accounting regulation and practice on related topics and the politics of the standard-setting process.

Awards offering Accounting for Groups

This unit is offered as a part of the following awards:

• Associate Degree in Business
• Bachelor of Arts
• Bachelor of Arts and Bachelor of Applied Social Science
• Bachelor of Arts and Bachelor of Business
• Bachelor of Arts and Bachelor of Education (Secondary)
• Bachelor of Business
• Bachelor of Business and Bachelor of Ministry
• Bachelor of Business and Bachelor of Theology
• Diploma of Arts
• Diploma of Business and Diploma of Entrepreneurship
• Diploma of Business and Diploma of Leadership
• Diploma of Business and Diploma of Ministry
• Diploma of Chaplaincy and Diploma of Leadership
• Diploma of Entrepreneurship and Diploma of Leadership
• Diploma of Entrepreneurship and Diploma of Ministry
• Undergraduate Certificate in Arts
• Undergraduate Certificate in Business Studies

Unit Content

Outcomes

1. Describe and discuss the theory and practice of accounting for business combinations in Australia; 
2. Identify and apply the appropriate conversion of foreign currency entities in group accounting; 
3. Explain and apply the regulations and standards that business combinations follow in accounting and reporting for their economic entities; 
4. Describe and discuss the concept of closed groups and how it impacts group accounting; 
5. Demonstrate the ability to prepare financial statements for reporting entities that accounts for subsidiaries, associates and joint ventures, and provides segment information;  
6. Describe and discuss segment reporting by diversified entities. 

Subject Content

1. Introduction to Corporate Combinations   
2. Principles of Consolidation 
3. Preparing for consolidation: Fair value adjustments and tax effects
4. Eliminating Intra-group transactions 
5. Non-controlling interest 
6. Partly owned subsidiaries 
7. Consolidated cash flow statements 
8. Accounting for Associates 
9. Accounting for Joint Ventures 
10. Closed Groups 
11. Translation and consolidation of foreign currency financial statements
12. Segment reporting by diversified entities

This course may be offered in the following formats

• Face-to-Face
• Distance/ Global Online

Please consult your course prospectus or enquire about how and when this course will be offered next at Alphacrucis University College.

Assessment Methods

1. Online Quiz (10%)
2. Individual Assignment (20%)
3. Case study report (20%)
4. Final Exam (50%)

Prescribed Text

•  Arthur, N., Luff, L., Keet, P., Egan, M., Howieson, B. and Ram, R. (2017). Accounting for Corporate Combinations and Associations (8th Ed.). Melbourne, Vic.: Pearson Australia.    ISBN: 9781488611520 
• Chartered Accountants Australia and New Zealand. (2021). Financial Reporting Handbook 2021 Australia. Milton, Queensland: John Wiley & Sons Australia.  ISBN: 9780730392217 

Check with the instructor each semester before purchasing any textbooks