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

Which statement correctly describes the treatment of a subsidiary with a different reporting date in consolidated financial statements under Ind AS 110?

The subsidiary prepares additional financial information as of the parent's reporting date so it can be consolidated, unless doing so is impracticable. Ind AS 110 requires the same reporting date for the parent and subsidiaries and does not allow exclusion merely because the dates differ.

  1. AThe subsidiary prepares additional financial information as of the parent's reporting date, unless impracticableCorrect
  2. BThe subsidiary's own reporting date is always used without any adjustment
  3. CThe parent's statements are adjusted to the subsidiary's reporting date
  4. DThe subsidiary is excluded from consolidation until dates match

Explanation

Ind AS 110 requires the parent and its subsidiaries to use the same reporting date. If dates differ, the subsidiary prepares additional financial information as of the parent's date so consolidation is possible, unless this is impracticable. Exclusion from consolidation is not the prescribed treatment.

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