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While preparing the Consolidated Statement Of Financial Position, why the share capital and share premium of subsidiary company are not clubbed with parent company’s equity & reserves and included within the group FS ?
Group accounts are prepared for the shareholders of the parent.
Imagine that SC for parent is 200 and SC for sub is 100.
There are 200 parent shareholders – they would be confused if we said there were 300.
…………..And the accounts would no longer balance!!
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