Present the financial affairs of a parent company and its legally distinct subsidiaries as if they were a single unified economic entity: Corporate Accounting Assignment, OUM, Malaysia
|University||Open University Malaysia (OUM)|
The purpose of consolidated financial statements is to ‘present the financial affairs of a parent company and its legally distinct subsidiaries as if they were a single unified economic entity (Huefner and Largay III, 1990, p. 26).
However, problems persist in relation to consolidated financial reporting such as ‘control when ownership is absent; technical issues of asset valuation; goodwill recognition, and minority interest presentation; and the need for separate reporting in addition to consolidated financial statements (Huefner and Largay III, 1990, p. 38).
The international financial reporting standard that provides guidance on consolidated financial statements is IFRS 10 (the Australian equivalent is AASB 10).
The objective of IFRS 10/AASB 10 Consolidated Financial Statements is to ‘establish principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities’ (AASB, 2015) There have been positive as well as negative reports on the implementation of IFRS 10/AASB 10.
For example, it leads to an increase in consolidated statements quality (Muller, 2014); the effects of the adoption are associated with financial reporting incentives (Bedford et al., 2022); or that consolidated financial statements do not possess the information content frequently attributed to them in the literature (Walker, 1976).
b. According to an article published by Huefner and Largay III (1990), one of the issues regarding consolidated financial reporting is ‘consolidation policy: the circumstances under which subsidiaries should or should not be consolidated.’ (Huefner and Largay III, 1990, p. 28).
Why do the authors think it is an issue? You must support your answer with published articles and journals.
Get Solution of this Assessment. Hire Experts to solve this assignment for you Before Deadline.
Get Help By Expert
Recent Solved Questions
- AAC20403: Using a diagram clearly explains the concept of price ceiling and Why are traders not able to adhere to the ceiling price of chicken: Financial Accounting and Reporting Assignment, MSU, Malaysia
- This accessible text provides a lively introduction to the essential skills of creative problem-solving: Creative Problem Solving Case Study, UMS, Malaysia
- KNC6063: Explain the relevant energy and environmental policies or related acts applied to the energy management for a chemical factory: Energy And Environment Law And Policy Assignment, UMS, Malaysia
- West End Bicycle is a company that has been manufacturing bicycles since 1985: IT Audit and Risk Management Report, ASB, Malaysia
- Determine the minimum fresh water and minimum wastewater targets for the above system using water cascade analysis: Advanced process integration Assignment, CU, Malaysia
- Offering a bribe is wrong because it is an inducement to act dishonestly, disregard one’s duties, and betray a trust: Business Ethics Assignment, CU, Malaysia
- ITS63504: You are recently hired by Hilti and are appointed as an International IT Consultant cum UI-UX Designer at Hilti Corporation: Human Computer Interaction Assignment, Malaysia
- This assignment seeks to enhance the students’ knowledge of the various development policies that have been formulated: Construction Economics Assignment, UiTM, Malaysia
- BTX5220: If individuals were employed solely on their ability to do the job, there would be no need for any anti-discrimination statutes: International Issues in Employment Law Coursework, MUM, Malaysia
- DSC7053: You are required to find any classification dataset whether from UCI or Kaggle in any field: Machine Learning Assignment Malaysia