Treatment of Dividends in the CSFP and CSPL

The process of consolidation involves treating all the entities within a group as though they were a single entity

So when a parent receives a dividend from a subsidiary, it’s like receiving a dividend from your right hand trouser pocket and putting it into your left hand trouser pocket

For the purposes of the consolidated statement of profit or loss, that investment income from within the group is ignored when adding across the incomes and expenses of the group

When a dividend has actually been PAID during the year, there will be no amount of the consolidated statement of financial position to record that dividend neither as a payable (in the subsidiary) nor as a receivable (in the parent)

If the subsidiary dividend is merely proposed as at the year end, the parent in its own records will be showing a dividend receivable as a current asset and the subsidiary will be showing a current liability dividend payable

That asset shown by the parent is cancelled against the liability shown in the subsidiary leaving only the amount of dividend payable to the nci as a liability and that figure will appear on the consolidated statement of financial position

Is that better for you?