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Consolidation

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Consolidation

  • This topic has 1 reply, 2 voices, and was last updated 13 years ago by MikeLittle.
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  • June 10, 2012 at 3:09 pm #53180
    dionnee
    Participant
    • Topics: 1
    • Replies: 0
    • ☆

    Hi, some help please. A company acquired 100% shares of another company, and the acquired company purchased some shares in the parent company. Upon consolidation of the financial accounts, do we eliminate the cost value of the shares the wholly owned sub purchased in the parent or do we eliminate the fair value?

    June 10, 2012 at 6:40 pm #99656
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23321
    • ☆☆☆☆☆

    The acquired company CANNOT own shares in the parent company – it’s contrary to ( English ) company law. Question answered?

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