Reference no: EM132907601

Rickman Enterprises Inc. (REI) is a publicly traded, Canadian-based diversified multinational corporation with numerous subsidiaries located throughout the world. Each subsidiary is a reportable industry segment for financial reporting purposes. On January 1, 20X9, REI acquired 100% of the voting shares of Minaker Confections Ltd. (MCL), a Colombian-based manufacturing company. Summarized financial statements for 20X9 are in Exhibit 1, along with exchange rates and supporting information.

• REI paid $4 million cash for the MCL common shares, an acquisition that involved goodwill of $500,000. REI issued shares to finance the acquisition. MCL is only one part of REI's extensive business operations and investment portfolio, but it has strategic importance as a low-cost manufacturing operation.

You, CPA, are a member of the accounting group at REI. The chief financial officer (CFO) is preparing for a senior management meeting, where accounting policies will be discussed before a presentation to the board of directors on the topic. The CFO made the following request:

Required:

Problem 1: memo that addresses the requests of the CFO.

Problem 2: Consider the requirements of IFRS, REI's financial reporting goals, and the potential bias of REI's management team. (NOTE: No calculations are required in your response.)