[mmohy]

Dear Sir,

Here is the situation:
Company(A)owns 80% of company(B)
Company (A) has an equity and shareholders loan in (B), no amounts are due to (A) from the minority holders in (B)
In addition company (C) which is a trading subsidiary of (A) has inter-company trading receivables due from (B)
From the consolidated accounts perspective, the balances in the shareholders loan and the trading subsidiary reported in the individual financials due from (B)are eliminated on the consolidation.

(A) decided to sell its investment in (B)company with an amount which is less than the carrying amount of the investment cost on (A) standalone financial statement, thus (A) will recognize loss on its individual financial statement , but it will recognize gain on the consolidation financials as the carrying amount of the investment in (B) on the consolidation level is less the carrying amount of the investment on (A) standalone financial due to loss of (B) which was recognized in the consolidation statements and no impairment took place in (A) standalone regarding (B) investment.

The most important part here that we were advised that the amounts owed from (B) prior to losing control which remain receivables after the control is lost.
Such amounts are considered to be consideration on the basis that they are recognized for the first time in the consolidated financials at the point of loss of control, such amounts as being recognized for the first time it should be recorded with the fair value as a profit on disposal on the consolidation level.
Is that treatment approved under the IFRS ?
Both companies is reporting under IFRS 2008.
Thank you very much for your help.

Kind Regards
Mohamed