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IFRS For Dummies by Steven Collings

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Chapter 11

Getting to Grips with More Complex Consolidation Issues

In This Chapter

arrow Handling the disposal of a subsidiary company

arrow Knowing what to do when ownership changes

arrow Working out goodwill

arrow Delving into deemed disposals

arrow Getting to grips with step acquisitions

Consolidated financial statements combine a parent company’s financial results with the results of the other company (or companies) that it owns or of which it’s the major shareholder. The idea is that the consolidated statements show the results of the group as a single reporting company.

Consolidated financial statements are quite complicated. If you’re unfamiliar with consolidations or your knowledge is a bit rusty, I suggest you read Chapter 10, which explains the basics, before diving into this one.

The purpose of this chapter is to get to grips with some of the complexities of consolidation. I examine what happens when a parent company decides to sell a subsidiary, and take a look at some of the issues that arise during ...

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