Measure NCI at its proportionate share of Baby’s net assets.Please note here that in the above statements of financial position, .That’s exactly WHY so many groups use their “” and subsidiaries’ accountants must fill them up along with preparing own financial statements.I’ll do it on a case study, with explaining what I do and why.If you don’t like reading, you can skip to the end of this article and watch my video.
Let’s be more practical today and learn some advanced accounting techniques.
After summaries of standards related to consolidation and group accounts, I’d like to show you how to prepare consolidated financial statements .
It’s very easy when a parent (Mommy) and a subsidiary (Baby) use the same format of the statement of financial position – you just add Mommy’s PPE and Baby’s PPE, Mommy’s cash and Baby’s cash balance, etc.
In reality, companies use their own format for presenting their financial position and therefore it can be difficult to combine.
If you’d like to revise a theory first, then please read my summary of IFRS 3 Business Combinations and IFRS 10 Consolidated Financial Statements, both of them contain video in the end.Here’s the question: Mommy Corp has owned 80% shares of Baby Ltd since Baby’s incorporation.