Consolidated financial statements

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Parth (Querist)

20 January 2011 Debentures in books of holdin co.
(75000 of100 each ). - 75 lakhs

Subsidiary holds 45000 debentures standing in its books at 42 lakhs

How to consolidate and what will be effect of the same while analysing for capital and revenue?will3 lakh be considered as profit and added to revenue side of p&l a/c while analysing the capital and revenue chart if yes then why ?

Manmohan ACA, CS

Manmohan ACA, CS (Expert)

20 January 2011 assuming that the subsidiary will sale these debentures now toy take Rs.3 Lakhs as profit and ass to subsidiary profit , so reduce debentures from subsidiary B/s assets side rs.42 lakhs , increase P/L if subsidiary by Rs.3 Lakhs and reduce holding debentures from liability side rs.45 lakhs

Parth

Parth (Querist)

22 January 2011 Plz can u explain by journal entries in books of subsidiary and holding co. Both. ?

Manmohan ACA, CS

Manmohan ACA, CS (Expert)

22 January 2011 entries in the consolidated books
Debentures [liability ](holding company) Dr.----- 45 Lakhs
----To Debentures[investment](subsidiaries company)rs.42 Lakhs
-----To P/L [subsidiaries]-------------------------rs.3 Lakhs

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