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CS Executive · Corporate Accounting and Financial Management · Introduction to Corporate Accounting

Which statement about consolidated financial statements under section 129(3) of the Companies Act, 2013 is correct?

Under section 129(3), a company with one or more subsidiaries must, in addition to its own financial statements, prepare consolidated statements of itself and all its subsidiaries in the same form and manner as its own, and lay both before the annual general meeting. Consolidation does not replace standalone statements.

  1. AA company with one or more subsidiaries must prepare consolidated financial statements in addition to its own, in the same form and manner, and lay both before the AGMCorrect
  2. BConsolidated statements replace the company's own financial statements, which need not be laid at the AGM
  3. CConsolidation is required only if the subsidiaries are listed
  4. DConsolidated statements need not follow the form of the company's own statements

Explanation

Section 129(3) requires a company with subsidiaries to prepare, in addition to its own statements, a consolidated statement of the company and all subsidiaries in the same form and manner, laid along with its own statements before the AGM. It is not a replacement and has no listing condition.

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