ACCA FR September 2026: The Mid-Year Acquisition Error That Scores Zero (15 Marks)

If you consolidate a mid-year subsidiary for the full year, you score zero for consolidating. Not partial credit — zero. The September/December 2025 FR examiner calls this a "fundamental accounting error," and it is still one of the most common ways candidates throw away a 15-mark question.

What the examiner actually said

The Partridge Co question asked for a consolidated statement of profit or loss for the year ended 31 March 20X6. Strawberry Co was acquired on 1 July 20X5 — nine months in. The examiner's verdict: "many candidates adjusted the subsidiary results incorrectly by either using an incorrect number of months or, critically, by not apportioning at all."

The penalty is spelled out. Fail to time-apportion, or multiply the subsidiary's results by the 80% group share, and "the candidate will receive no marks for consolidating the parent and subsidiary." You can still pick up marks on the individual adjustments — the URP, the dividend, the fair value depreciation — but the backbone of the question is gone before you start.

This is not a knowledge gap. A statement of profit or loss covers a period of time. You only owned the subsidiary for part of it. Everyone knows that. It gets missed because candidates dive into the additional information before setting up the pro forma.

Wrong answer vs right answer

Subsidiary revenue of $8m. 80% acquired on 1 July 20X5. Group year end 31 March 20X6.

Wrong (no apportionment): Revenue = Parent + $8m. Twelve months of a subsidiary you owned for nine. Zero consolidation marks.

Wrong (proportionate consolidation): Revenue = Parent + (80% × $8m) = Parent + $6.4m. The examiner names this one explicitly as a fundamental accounting error. You control the subsidiary — you consolidate 100% line by line and strip the NCI out at the bottom.

Right: Revenue = Parent + (9/12 × $8m) = Parent + $6m. Full amount, time-apportioned. Then profit attributable to owners of the parent and to NCI at the foot of the statement.

The nine months follows you down the page

Time-apportionment is not a one-off adjustment at the top. It runs through the whole answer, and this is where the marks quietly leak away.

The deferred consideration unwinding is nine months of finance cost, not twelve — and it belongs in financing. The examiner: "Full marks could not be awarded to candidates who included this interest expense outside of the financing category." The fair value adjustment on plant was correctly spread over four years by most candidates, then not time-apportioned by nine months. The intragroup dividend was paid after acquisition, so you eliminate the 80% actually received — not the full $2m, and not a time-apportioned slice of it. And the inventories fair value adjustment was, in the examiner's words, one many candidates "did not attempt at all."

The unrealised profit trips people for a different reason: candidates calculated the markup on the full $3m sale rather than the $900,000 still in inventories, or used margin when the question said markup.

Three things to do

1. Build the pro forma first — including the NCI split. Before you read a single note, set up the CSPL skeleton with "Profit attributable to: owners of the parent / non-controlling interest" already typed at the bottom. The examiner notes many candidates "ignore this area completely and miss several marks." Put the apportionment fraction in a cell at the top where you can see it.

2. Circle the acquisition date before anything else. Twelve months or more? Consolidate in full. Mid-year? Write the fraction down and apply it to every subsidiary income and expense line, plus every adjustment that relates to the post-acquisition period.

3. Use the spreadsheet, not the calculator tool. The examiner is blunt: candidates who use the calculator and show no workings get "full marks for a correct answer but, if the answer is incorrect and in the absence of a relevant working, no marks will be awarded." Own-figure marks only exist if the marker can see your figures.

The numbers

FR passed 52% in June 2026 — mid-table for Applied Skills, above AA at 47% and PM at 41%, below TX at 55%. Consolidation is syllabus area D and it turns up in Section C every sitting. A 15-mark question where the marks are largely mechanical is the most winnable thing on the paper.

Nine months means nine months. Write the fraction down before you write anything else.