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Hi Mike
Can you please tell me, how to account for Loans held by one company inn other (parent investing in loan notes of Subsidiary) and loan interest payed by the Subsidiary
ThanksThe asset will cancel against the same amount in the liability.
As for loan interest, the parent will receive and show as investment income. The subsidiary will pay and show as finance charges.
The amount received by the parent will be cancelled against the same value within the subsidiary’s finance charges leaving just finance income received from outside the group and finance charges payable outside the group
OK?
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