Consolidated financial statements are financial statements that present the assets, liabilities, equity, income, expenses and cash flows of a parent and its subsidiaries as those of a single economic entity.
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"A" company owns 60% of the outstanding voting stock of "v" corporation, what method should "A" Company use to account for the investment?
hen a large company acquire one or more small companies then acquiring company is called the parent company and acquired companies are called subsidiary companies so when the financial statements of parent company and subsidiary companies are prepared in one financial statement altogether those financial statements are called consolidated financial statements.
Subsidiary companies are also part of group of companies so parent company is required to show the financial statements of group as a whole so that's why consolidated financial statements are prepared
the Federal Financial Management Act of 1994 extended the scope of the CFO Act by requiring agency-wide financial statements and a consolidated government-wide financial statement
The main difference between consolidated and parent entities is that consolidated financial statements show the activities of the parent company and all of its subsidiaries. A stand alone, or parent financial statement, treats each subsidiary as a a separate entity.
How might changing one of the financial statements affect the other financial statements?
why consolidated financial statements become increasingly important when purchase differential is very large?
provide sample accountant accompanying notes to consolidated financial statements
Comparative financial statements compares one set of financial statement with another set of financial statements while consolidated financial statement is prepared where in company there is parent and child company relationship exists to join the financial statements of parent and child company as a single financial statements.
Consolidated Financial Statements are mandatory for tax reporting.
an accounting change that should be reported by restating the financial statements of all prior periods presented.
consolidated statements
hen a large company acquire one or more small companies then acquiring company is called the parent company and acquired companies are called subsidiary companies so when the financial statements of parent company and subsidiary companies are prepared in one financial statement altogether those financial statements are called consolidated financial statements.
1. Goal of consolidated financial statement is to combine the financial statement of parent as well as child companies as a one set of financial statement to show the overall performance of company rather showing separate financial statements for every company.
Subsidiary companies are also part of group of companies so parent company is required to show the financial statements of group as a whole so that's why consolidated financial statements are prepared
the Federal Financial Management Act of 1994 extended the scope of the CFO Act by requiring agency-wide financial statements and a consolidated government-wide financial statement
Combining financial statements could be a disadvantage because you cannot see the details that give you the strengths of the company. If you have separate financial statements for the parent and subsidiaries then you can break down a more meticulous analysis for each department and therefore see the basis and solidarity of the company
Nonconsolidated subsidiaries are expected to be relatively rare. In those situations where a subsidiary is not consolidated, the investment in the subsidiary should be reported in the consolidated statement of financial position at cost, along with other long-term investments.