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Hi Sir,
Thanks for the great job you are doing. I have question to ask on consolidation.
If P co owns 80% share in S co and S co in turn owns 60% share in A co. In consolidation of the account for P co, what accounts will be the basis? Will it be the individual accounts of P co, S co and A co OR it will be the individual account of P co on one hand and the consolidated account of S co on the other?In the exam, we do the “one-stage” consolidation – that is we consolidate P with S and A
But in practice, S too must prepare consolidated accounts for the S Group (S with A)
So in consolidating P S A, do we treat A as Associate of P or as Subsidiary of P taking into account P do not directly own A?
This is NOT an F7 topic – it’s P2!
Briefly – it’s a subsidiary – but I’m saying no more simply because it IS a P2 topic
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