Ind AS 110, Consolidated Financial Statements : The objective of Ind AS 110, is to establish principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities.
Consolidated Financial Statements are the financial statements of a group in which the assets, liabilities, equity, income, expenses and cash flows of the parent and its subsidiaries are presented as those of a single economic entity.Ind AS 110
- Power over an investee - when the investor has existing rights that give it the current ability to direct the relevant activities, e., the activities that significantly affect the investee’s returns.
- Exposure, or rights, to variable returns from its involvement with the investee - An investor is exposed, or has rights, to variable returns from its involvement with the investee when the investor’s returns from its involvement have the potential to vary as a result of the investee’s performance. The investor’s returns can be only positive, only negative or both positive and negative.
- The ability to use power over the investee to affect the amount of the investor’s returns - An investor controls an investee if the investor not only has power over the investee and exposure or rights to variable returns from its involvement with the investee, but also has the ability to use its power to affect the investor’s returns from its involvement with the investee. Thus, an investor with decision-making rights shall determine whether it is a principal or an
Accounting Requirements
- derecognize the assets and liabilities of former subsidiary;
- recognizes any investment retained in the subsidiary at its fair value in accordance with Ind AS 109;
- recognizes gain and loss associated with the loss of control.