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Dear Sir,
Why do we deduct the Parent’s NCI share of investment in the calculation of goodwill for the sub subsidiary to debit the NCI of the subsidiary?
Thanks
Hi,
This has been explained in the videos accompanying the class notes. Have you watched it?
Effectively, as we are reporting to the shareholders of the parent we only want to calculate the goodwill based upon what their share of the investment in the sub-sub is. So if we deduct the NCI share then we end up with the parent’s share. I find it easier to just include P’s share directly.
Thanks
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