In this workout, miso Ramin group is preparing to spin off a subsidiary. We're asked to adjust the group balance sheet to account for the spinoff. The first thing we note is that the group balance sheet here already includes the subsidiary. We need to get rid of it. So we start by doing our group excluding sub column. For that, I'll take the group and then I'll add on any adjustments, which will include the deconsolidation.

I'm going to copy that formula down so it's in line with all of the blue figures. And for all of my subtotals, I'll copy them across so they sum upwards.

Now, because we're doing a spinoff, that means we're completely separating the subsidiary from the group. Our group includes the subsidiary already, so my adjustment is going to be to de consolidate the subsidiaries cash from the groups cash. So in our top line here, we had group cash of 100. We now get rid of 30 of that to get to our group, excluding subsidiary cash of 70. Now we do exactly the same for all of our assets and our liabilities, but we don't do that for equity. For equity. We don't de consolidate equity. When you purchase a subsidiary, you don't consolidate its equity, therefore you don't de consolidate it. At the end. However, we do something which looks extremely similar. What we're gonna do is we're gonna pay a dividend to our shareholders, and that dividend in kind will be exactly the same worth as the equity. We're effectively giving away all of that value to those shareholders, and thus it'll become a completely separate company. So what do we notice? Our group assets were 600. They've now gone down by the one 70 to four 30, and our group liabilities and equity have gone down by the same amount.