M/s XYZ Pvt. Ltd. has formed a joint venture with M/s PQR Pvt. Ltd. naming it as M/s ABC - Joint Venture (AOP). M/s XYZ holds 51% and M/s PQR holds 49%. None of the company has made any capital contribution to the AOP.
During the year end M/s ABC (AOP) makes profit of Rs. 1 lakh.
Now, in books of M/s XYZ, while consolidating Profit of Rs. 51K will be shown as part of Reserves & Surplus, however what will be the other effect on asset side? How it will be presented?
If M/s XYZ holds only 25% - whether consolidation has to be carried out?
Pls. Note: None of the companies are part of any Listed companies so IND AS wont apply.
CAclubindia
