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Consolidation of accounts

01 October 2016

how to consolidate an expenses which has been capitalised by holding company whereas the subsidiary co. has treated it as revenue expenses

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CA Tanvi Sheth (Consultant) (232 Points)
Replied 03 October 2016

Hello,

As per AS 21, while consolidating the accounts, we have to follow uniform accounting policies for both the companies. Now as per your question, expense which is capitalised by one and shown as revenue by other will conflict uniformity of accounting policy. So it is better to show both of them separately so as to comply with disclosure requirement.