When a parent has legal control of a subsidiary, the parent consolidates the subsidiary's financial results with its own.
ugly people online dating - Consolidating subsidiary under equity method
Classification of the investment depends on the intent of the investor.
If the investor intends to profit from near-term (generally within than 12 months of initial investment) price movements, they are classified as either .
All of Tango's income statement flows are recorded on Alpha's income statement, less minority investors' 20% interest in Tango's net earnings.
We will cover the accounting specifics of the consolidation method in the lesson on Purchase Accounting.
IAS 27 was reissued in January 2008 and applies to annual periods beginning on or after 1 July 2009, and is superseded by IAS 27 Separate Financial Statements and IFRS 10 Consolidated Financial Statements with effect from annual periods beginning on or after 1 January 2013.
Consolidated financial statements: the financial statements of a group presented as those of a single economic entity.
FAS 160, effective January 1, 2009, made significant changes to the accounting requirements for noncontrolling interest in consolidated financial statements.
For now, let's just point out that FAS 160 drops the term The parent consolidates 100% of the subsidiary's assets and liabilities, regardless of the parent's actual percent equity ownership, and records any goodwill created in the acquisition of the controlling interest.
The excess of what Alpha "pays" for Tango over the FV of Tango's identifiable assets is allocated to goodwill ( = 0 - ).
The remaining 20% of Tango that Alpha does not own is reflected in minority interest ( = 0 - ).
The International Accounting Standards are similar to U. The equity method of accounting is sufficiently complex that we have dedicated a whole page to the topic.