Worked examples: Calculation of cost bases
Worked examples: Calculation of cost bases
Example 1: An IAG shareholder who acquired shares at demutualisation Initial cost base
Purchase date 19/06/2000
Initial total cost base
(A) $1,780
Initial number of shares
(B) 1000
Capital return and consolidation
$0.195 per share paid (1000 shares x $0.195 per share = $195.00)
Consolidation of shares (1000 at 0.9760 consolidation rate) = 976 shares
Calculation of new cost base
Initial cost base per share (C)= A/B $1.78
Purchase date 19/06/2000
Reduced total cost base (initial cost base less
capital return) (D)= A- (B x $0.195)
$1,585
Reduced number of shares (adjusted
for rounding) (E)= B x 0.9760
976
Reduced cost base per share (F)=D/E $1.62
Example 2: An IAG shareholder with multiple tranches of purchases in holdings Initial cost base
Purchase date
19/06/2000 8/08/2000 17/04/2008 Total
Initial total cost base
(A) $1,780 $497.75 $2,222.25 $4,500
Initial number of shares
(B) 1000 181 519 1700
Initial cost base per share (C)= A/B $1.78 $2.75 $4.28
Capital return and consolidation
$0.195 per share paid (1700 shares x $0.195 per share = $331.50)
Consolidation of shares (1700 shares at 0.9760 consolidation rate) = 1660 shares (1659.20 shares rounded up)
Calculation of new cost base
Reduced
Reduced total
number
cost base
of shares
(initial cost
(adjusted
base less
for
Purchase date
capital return)
rounding)
(D)= A- (B x $0.195)
(E)= B x 0.9760
1/06/2000
$1,585
976
8/08/2000
$462.46
177
17/04/2008
$2,121.05
507
Total
$4,168.50
1660
Note: Rounding of shares for individual years is shown for indicative purposes only.
Reduced cost base per share (F)=D/E $1.62 $2.61 $4.18
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