Question One

Keya limited acquired 36 million shares of Ruma limited on 1^st April 2017. Ruma limited is a foreign subsidiary whose currency is RF. The following statement of financial position relate to Ruma limited at Kaya Limited as at 31^st March 2013

	Kenya limited Kshs, million	Kshs. Million	Ruma limited RFmillion	RF million
Non current assets		630		800
Plant property & equipment		120		----
Investment in Ruma		750		800
Current Assets
Inventories	250		300
Trade receivables	200		280
Cash	60		50
Less current liabilities
Trade payables	250		200
Current tax	70		80
Net assets	30	160	____	350
		910		1,150
Financial by
Long term borrowing	200		250
Deferred tax	60	260	100	350
Equity
Ordinary shares (Kshs. I/RF 10)		300		400
Revaluation reserves		350		60
Retained earnings		910		1,150

Additional information

1. Kaya limited acquired the shares in Ruma limited when the retained earnings of Ruma limited were RF. 260 million. It is the policy of the group to value non-controlling interest on the basis of net identifiable assets.
2. During the year emended 31^st march, 2012, Ruma limited sold goods to kaya limited and reported a profit mark-up of 331/3%. The inventory of kaya limited included goods valued at Kshs. 10 million purchased from Ruma limited. The exchange rate was Kshs. 1/RF5). Kaya limited had sent a cheque of kshs. 10 millions to Ruma limited to clear the inter group balance which had not been by Ruma limited as at 31^st March 2012.
3. Ruma limited acquired some property on 1^st April 2011 for RF. 250 million and took a loan to finance this acquisition. The buildings had been estimated useful life of 25 years with depreciation being on the straight line method. The buildings were professionally valued at RF. 300 million on 31^st March 2012. This already reflected in the financial statement. The policy of the group is to show buildings at depreciated historical cost.
4. Ruma limited operates with a significant degree of autonomy from Kenya limited.
5. The relevant exchange rates are as follows:

SGI = RF

1 April 2010 6

31 March 2012 5.5

31 March 2012 5

Weighted average for the year ended 31.03.2012 5.2

Required:

1. Provide the translated statement of financial position of Ruma limited as at 31.03.2012 (12 marks)
2. Provide the consolidated statement of financial position for the Kaya groups as at 31.03. 2012 ( 13 marks)