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Dear Tutor,
Please advise the reason behind removing the NCI’s(subsidiary) investment in the sub subsidiary in NCI calculations?
Regards,
NaveenOtherwise you will be double counting. If you apply the total nci percentage to the sub-sub’s assets and then apply the nci percentage to the subsidiary’s assets, thes a double counting. Part of the subsidiary’s assets is the subsid’s investment in the sub-sub’s share capital
That share capital (in part) represents the net assets of the sub-sub so not only will you be taking the nci share of the investment in the sub-sub, you will also be taking the indirect nci share in those same net assets of the sub-sub
Very difficult to explain all this in the written word – do I not try to explain it in recorded lectures?
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