Consolidating subsidiaries with different year ends Women who like sexchat and send pictrues
Below there are statements of financial positions of both Mommy and Baby at 31 December 20X4.
Prepare consolidated statement of financial position of Mommy Group as at 31 December 20X4.
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IFRS 10 Consolidated Financial Statements outlines the requirements for the preparation and presentation of consolidated financial statements, requiring entities to consolidate entities it controls.
This article will not go into the detail of preparing consolidated financial statements because the principles involved are largely the same as under previous UK GAAP.
For example, the requirement to eliminate intra-group trading is still the same and the consolidation of a subsidiary is required when the parent company controls the operating and financial policies of the entity (which is often achieved with an ownership interest of more than 50% of the net assets).
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Consolidated financial statements make the financial statements of the parent company and its subsidiaries appear like those of a single entity.This is because paragraph 9.19D of FRS 102 (September 2015) regards such transactions as one among equity holders in their capacity as equity holders, as can be seen in the following example: Example – Parent acquires further ownership interest On 1 January 2016, Holdco Ltd acquired 80% of the net assets of Subco Ltd for a consideration of £125,000.At the date of acquisition, the fair value exercise revealed the net assets of Subco to be £70,000 and this was also equivalent to their book value.This increases the parent’s ownership interest and dilutes the non-controlling interest (previously referred to as ‘minority interest’).It is this situation which has been subject to significant change under FRS 102 when compared to previous FRS 2 .