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CS Executive · Corporate Accounting and Financial Management · Consolidation of Accounts

Under AS 21, how are the parent's share of post-acquisition reserves of a subsidiary shown in the consolidated balance sheet?

The parent's share of post-acquisition reserves is included within the consolidated reserves and is not separately disclosed. AS 21 explains that this is consistent with presenting financial information of the group as a single whole.

  1. AAs a separate line called post-acquisition reserve
  2. BIncluded in the consolidated reserves without separate disclosureCorrect
  3. CSet off against goodwill on consolidation
  4. DTransferred to minority interest

Explanation

The Explanation to AS 21 para 13 says the parent's share of post-acquisition reserves forms part of the corresponding reserves in the consolidated balance sheet and need not be disclosed separately, since the aim is to present the group as a whole.

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