Group Accounting.pdf - Groups and Group Accounting Why...

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Groups and Group Accounting Why group? = Consolidated accounts give a true and fair view Why do group accounting? - Present info about PU and SU as a single economic entity - Provide further and better information for shareholders - Removal of ability for PU to hide info in SU IAS 27 - Definitions NCI = Portion of profit or loss and net assets of subsidiary attributable to equity interests that are not owned, directly or indirectly through subsidiaries What is control of a subsidiary? - PU owns directly/indirectly majority of voting rights (Unless in exceptional circumstances where ownership doesn't mean control) - Power over more than ½ of voting rights by virtue of an agreement - Power to govern financial and operating policies of the enterprise - Power to appoint/remove the majority of the board members - Power to cast majority of votes at board meetings
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Different methods - Only ever post acquisition profits - If Co A buys 80% of Co B then the 20% will be NCI Full/Proportional B/S - Line by line goes to CBS -
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  • Winter '12
  • Balance Sheet, NCI, Generally Accepted Accounting Principles, Subsidiary, CO A

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Christopher Reinemann
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