It can also be said that the financial statements prepared by the holding company on the basis of the accounting entity composed of the parent company and its subsidiaries, as well as the individual financial statements prepared by the holding company alone, reflect the consolidated financial position and operating results of the group after the offset of the intra-group current accounts.
Extended data
Procedures for preparing consolidated statements usually include:
(1) Check and adjust possible errors and omissions in the accounting statements of the parent company and subsidiaries.
(2) Offset unrealized gains and losses of internal transactions of enterprise groups.
(3) Write off the statutory surplus reserve and any surplus reserve drawn by subsidiaries to realize net profit.
(4) Offset the investment income and dividends received by the parent company from its subsidiaries, and adjust the balance of the equity investment account of the parent company to the initial amount.
(5) Offset the balance of the parent company's equity investment account and the subsidiary company's owner's equity account at the beginning of the year, and confirm the difference between them as the consolidated spread; If there are minority shareholders, it is also necessary to confirm the corresponding minority shareholders' rights and interests.