Note 1 – Alpha’s investment in Beta
On 1 April 2010, Alpha acquired 120 million shares in Beta by means of a cash payment of $234·5 million. Alpha also incurred directly attributable costs of $2·5 million associated with the acquisition of Beta and recognised the investment in its individual statement of financial position at $237 million. There has been no change to the carrying value of this investment in Alpha’s own statement of financial position since 1 April 2010.

It is the group policy to value the non-controlling interest in subsidiaries at the date of acquisition at fair value. The market value of an equity share in Beta at 1 April 2010 can be used for this purpose.

On 1 April 2010, the market value of a Beta share was $1·80. On 1 April 2010, the individual financial statements of Beta showed the following reserves balances:

– Retained earnings $75 million. 
– Other components of equity $1 million.

The directors of Alpha carried out a fair value exercise to measure the identifiable assets and liabilities of Beta at 1 April 2010. The following matters emerged:

– Property having a carrying value of $150 million at 1 April 2010 (depreciable component $80 million) had an estimated market value of $180 million at that date (depreciable component $90 million). The estimated future economic life of the depreciable component at 1 April 2010 was 20 years. This property is included in Beta’s statement of financial position at 31 March 2015. 
– Plant and equipment having a carrying value of $110 million at 1 April 2010 had an estimated market value of $123 million at that date. Beta has disposed of all of this plant and equipment since 1 April 2010.

The fair value adjustments have not been reflected in the individual financial statements of Beta. In the consolidated financial statements, the fair value adjustments will be regarded as temporary differences for the purposes of computing deferred tax. The rate of deferred tax to apply to temporary differences is 20%. No impairment of the goodwill on acquisition of Beta has occurred since 1 April 2010.

Note 2 – Alpha’s investment in Gamma
On 1 July 2014, Alpha acquired 90 million shares in Gamma by means of a share exchange. Alpha issued two shares for every three shares acquired in Gamma. On 1 July 2014, the market value of an Alpha share was $2·90 and the market value of a Gamma share was $1·50. The share exchange has not been recorded in the draft financial statements of Alpha presented above. Alpha also incurred directly attributable costs of $1·5 million associated with this acquisition and debited these costs to administrative expenses in its draft statement of profit or loss for the year ended 31 March 2015.

On 1 April 2014, the individual financial statements of Gamma showed the following reserves balances:

– Retained earnings $45 million. The profits of Gamma for the year ended 31 March 2015 accrued evenly over the year. 
– Other components of equity $2 million. See also the information provided in note 3 regarding other components of equity.

Gamma leases all of its properties on operating leases and its plant and equipment comprises assets with relatively short useful economic lives. Therefore on 1 July 2014, there were no material differences between the carrying values of the net assets of Gamma in the individual financial statements and the fair values of those net assets.

No impairment of the goodwill on acquisition of Gamma has occurred since 1 July 2014.

Note 3 – Other investments 
Apart from its investment in Beta, the investments of Alpha included in the statement of financial position at 31 March 2015 are all financial assets which Alpha has elected to measure at fair value through other comprehensive income. All of the investments held by Beta and Gamma are also financial assets which Beta and Gamma have elected to measure at fair value through other comprehensive income. None of these investments have been bought or sold in the year ended 31 March 2015. The fair values which are included in the draft statements of financial position above are the fair values at 31 March 2014 for Beta and 1 July 2014 for Gamma. Relevant fair values as at 31 March 2015 were as follows:

– Alpha – $33 million. 
– Beta – $43 million. 
– Gamma – $11·6 million. The change in the fair value of Gamma’s investments during the year ended 31 March 2015 was caused by events occurring AFTER 1 July 2014.

You do NOT need to consider the deferred tax implications of any gains arising on the remeasurement of these investments.

Note 4 – Inter-company sale of inventories
The inventories of Beta and Gamma at 31 March 2015 included components purchased from Alpha in the last three months of the financial year at a cost of $15 million to Beta and $10 million to Gamma. Alpha normally earns a profit margin of 30% on the sale of these components but supplies of these components to group companies are routinely made at a reduced margin of 20%.

In the consolidated financial statements, any adjustments required as a result of this note will be regarded as temporary differences for the purposes of computing deferred tax. The rate of deferred tax to apply to temporary differences is 20%. You can assume that sufficient taxable profits exist in each entity to allow the deferred tax implications of deductible temporary differences.

Note 5 – Trade receivables and payables
The trade receivables of Alpha included $9 million receivable from Beta and $6 million receivable from Gamma in respect of the purchase of components (see Note 4). On 30 March 2015, Beta and Gamma paid $9 million and $6 million respectively to Alpha and so eliminated their trade payables balance in respect of the purchase of components. Alpha recorded these receipts on 3 April 2015.

Note 6 – Provision 
On 1 March 2015, the board of directors of Alpha finalised a plan to re-organise and reconstruct the group. The plan was publicly announced on 15 March 2015. The plan involved closing down one of Alpha’s operating units – unit X (not a separate legal entity). The business of unit X will not be discontinued – the other operating units of Alpha will be able to supply the unit’s existing customers. However, all of the property, plant and equipment being used in unit X will be disposed of. Some of the employees working in unit X will be made redundant, and others will be transferred to other operating units of Alpha.

The provision made by Alpha in its draft financial statements comprised the best estimate of the following:

On 15 March 2015, the property, plant and equipment of unit X, which is included in the above statement of financial position, had a total carrying value of $15 million. $12 million of this amount relates to property, and $3 million to plant and equipment. On 15 March 2015, all of the property, plant and equipment was offered for sale. The property was offered for sale at a price of $16·5 million, and the plant and equipment at $1·05 million. Both of these amounts are considered to be reasonable prices which are achievable within six months of the year end. The estimated costs of disposal of the property are $500,000 and the costs of disposal of the plant $50,000. However, none of the property, plant and equipment of unit X which was being offered for sale had actually been sold by 31 March 2015. You can assume that any change in carrying value of this property, plant and equipment between 15 and 31 March 2015 is immaterial.

Note 7 – Long-term borrowings
On 31 March 2015, Alpha issued 30 million $1 convertible loan notes. The loan notes carry a coupon rate of 6% per annum payable annually in arrears and are redeemable at par on 31 March 2020. As an alternative to redemption, the loan note holders can elect to exchange their loan notes for equity shares in Alpha on 31 March 2020. If the option to exchange were not available, the investors in the loan notes would have required a return on their investment of 10% per annum.

Discount factors which may be relevant are as follows:

On 31 March 2015, Alpha debited cash and credited long-term borrowings with $30 million in respect of this loan.

Required:
Prepare the consolidated statement of financial position of Alpha at 31 March 2015.