The compilation of consolidated statements means that two companies are regarded as one company, and the parent company that issued the statements should include all subsidiaries in the scope of consolidation of consolidated financial statements. That is, as long as it is a subsidiary controlled by the parent company, regardless of the size of the subsidiary, whether the ability of the subsidiary to transfer funds to the parent company is strictly restricted, and whether the business nature of the subsidiary is significantly different from that of the parent company or other subsidiaries in the enterprise group, it should be included in the consolidated financial statements.
It should be noted that for overseas subsidiaries subject to foreign exchange control and other controls of the host country, the financial and operating policies of the investee are still determined by the company, and the company can also benefit from its business activities. The restriction of fund scheduling does not prevent the company from controlling it. Therefore, it should be included in the consolidated financial statements.
Determine the consolidation scope of consolidated reports (control principle)
According to the reasons for the formation of subsidiaries, subsidiaries are classified as follows:
1. subsidiaries acquired through business combination;
2. Subsidiaries acquired through investment;
3. Subsidiaries acquired through administrative transfer
0 2
Adjust individual financial statements of subsidiaries before merger.
1. Adjustment of accounting policies:
Adjust the individual financial statements of subsidiaries according to the accounting policies of the parent company.
2. Adjustment of accounting period:
Adjust the subsidiary statements according to the balance sheet date and accounting period of the parent company.
3. The functional currency of the subsidiary's financial statements is inconsistent with that of the parent company:
When preparing consolidated statements, it is necessary to convert the foreign currency statements of subsidiaries into statements with the same accounting currency as the parent company.
4. Adjustment of fair value:
For the identifiable assets, liabilities and contingent liabilities of subsidiaries acquired by holding merger not under the same control, based on the fair value on the purchase date, the individual financial statements of subsidiaries are reflected as the amount of identifiable assets, liabilities and contingent liabilities determined on the basis of the fair value on the purchase date when preparing consolidated statements.
0 3
Check internal transactions and exchanges
Check the internal transactions and exchanges between the parent company and its subsidiaries, find out the reasons for the differences, and make corresponding accounting adjustments to lay a good foundation for the compilation of consolidated offset entries;
0 4
Prepare working papers for the merger.
1. Enter the balance sheets, income statements and cash flow statements of the parent company and subsidiaries into the consolidated working paper, and add up the data (the consolidated statement of changes in owners' equity is generally filled in according to the consolidated balance sheet and consolidated income statement in practice);
2. Prepare adjustment entries and offset entries in the consolidated working paper.
(1) Offset the long-term equity investment of the parent company and the owner's equity of the subsidiary, and offset the investment income of the parent company to the subsidiary with the profit distribution of the subsidiary;
(2) Offset the balance sheet, income statement, cash flow statement items and internal current balance involved in internal transactions between the parent company and subsidiaries at all levels;
(3) Deferred income tax assets or deferred income tax liabilities are recognized at the level of consolidated financial statements.
0 5
Calculate the consolidated amount of each item in the consolidated financial statements.
Fill in the consolidated financial statements reported to the outside world (actually calculated automatically by EXCEL formula).