Financial Statements with Indirect Equity Interest

This presentation focuses on the financial statements when there is an indirect equity interest. It explains non-sequential acquisition, non-controlling interest, and direct and indirect equity interest. It covers balance sheets, income statements, cash flows, and consolidated financial statements. It also discusses the calculation of indirect interest and the concept of non-controlling interest.

The financial statements
when there is an
indirect equity interest

 The presentation will focus on the financial
statements when there is an indirect equity
interest.
 In this non sequential acquisition and Non
controlling interest will be explained.
 The explanation of the direct and indirect
equity interest will also be done.
Introduction

 It reflects the financial position and the
financial performance of the company.
 It includes four thing which are stated
below:
 Balance sheet
 Cash flows
 Income statement
 Retained earnings
Financial statements

 To evaluate the capital structure and the
computing the rate of return this financial
statements are used (Müller, 2014).
 It includes assets, liabilities and equities of
company which is helpful for the investors
to take the decisions.
 The formula of the balance sheet is the:
Assets=Liabilities +Shareholders Equity
Balance sheet

 It benefits in examining the financial
presentation of the company for the specific
period.
 It includes revenues, losses, profit and
expenses.
 With the help of this financial report, the net
income and the gross income of the
company can be evaluated.
Income statements

 Net amount of the cash inflow and cash
outflow (Gilens and Page, 2014).
 This financial statements helps in analyzing
the ho much cash the company operates.
 It includes the three activities:
 Operating activity
 Investing activity
 Financing activity
Cash flows

 It is the monetary statements in which all
the paternal plus the subsidiary company
are presented as the single entity (Müller,
2014).
 The two basic procedures are followed when
the combined financial statements are
prepared:
 The substances that are accounted as
assets and liability has to be cancel.
 After cancelling all the items these are
added.
Consolidated financial
statements

 It is the equity security of the company
which is the outstanding equity interest of
the company.
 It is owned by the interest holder of the
company (Gilens and Page, 2014).
 when the interest are hold of the connected
intermediately and the dilutive effects of
the interest are also taken into the account.
Indirect equity interest

 This amount is evaluated by reproducing
the proportion of ownership with the every
entity.
 The possession interest is calculated by the
sum up all the business assets and
subtracting the depreciation amount so that
net value asset can be ascertained
(Kalemis, et al., 2013).
Calculation of indirect
interest

 It is the possession of the equity, stock in
the interest of the profit of the disclosing
entity.
 It is the aggregate purchase price for the
direct ownership interest.
 In this the disclosing entity is that which is
furnishing the services and arranging for
that.
Direct ownership interest

 In the disclosing entity indirect possession
concentration is the entity which has the
direct and the indirect ownership interest.
 It helps in governing and operating and
financial activities so that the benefits from
the activities can be powered.
 It is the interest which can arise without the
direct ownership interest.
Indirect interest

 When the company purchases the shares of
the other company so that the control in
that company can be gained.
 When more than the 50% of the firm’s stock
is taken so that the decisions can be taken.
 Acquisition diversified the market of the
company at the extent level (Matlen and
Klahr, 2013).
Acquisition

 In this prior to the acquisition the
intermediately subsidiary acquires the low
level of subsidiary (So and Smith, 2019).
 The carrying amount of the asset is different
from the acquired asset as its investment in
subsidiaries.
 Using the bcvr entries the investment in the
subsidiaries are adjusted to the fair value.
Account for the non sequential
acquisition

 When the share of the ownership was not
controlled and owned by the parent
company.
 When the entity has no owner in taking nay
decisions as the shareholders owns is less
than the 50% (Togashi, 2014).
 They don’t have nay potential rights and
measured at the net asset value of the
entity.
Non controlling interest part of
the equity

 From the above report it is clearly stated
that financial statements are helpful in
showing the performance of the company.
 Consolidated financial statements are e all
the parent and the subsidiary company are
presented as the single entity.
 In this presentation the non sequential
acquisition and Non controlling interest has
also explained.
Conclusion

 Gilens, M., & Page, B. I. (2014). Testing theories of American
politics: Elites, interest groups, and average
citizens. Perspectives on politics, 12(3), 564-581.
 Kalemis, A., Delattre, B. M., & Heinzer, S. (2013). Sequential
whole-body PET/MR scanner: concept, clinical use, and
optimisation after two years in the clinic. The
manufacturer’s perspective. Magnetic Resonance Materials
in Physics, Biology and Medicine, 26(1), 5-23.
 Müller, V. O. (2014). The impact of IFRS adoption on the
quality of consolidated financial reporting. Procedia-Social
and Behavioral Sciences, 109, 976-982.
References

 Matlen, B. J., & Klahr, D. (2013). Sequential effects of high and low
instructional guidance on children’s acquisition of experimentation
skills: Is it all in the timing?. Instructional Science, 41(3), 621-634.
 So, S., & Smith, M. (2009). Value Relevance of IAS 27 (2003)
Revision on Presentation of Non‐Controlling Interest: Evidence
From Hong Kong. Journal of International Financial Management &
Accounting, 20(2), 166-198.
 Togashi, H. (2014). U.S. Patent No. 8,814,704. Washington, DC:
U.S. Patent and Trademark Office.
References