Consolidating companies with different year ends
When the end of the reporting period of the parent is different from that of a subsidiary, the subsidiary prepares, for consolidation purposes, additional financial information as of the same date as the financial statements of the parent to enable the parent to consolidate the financial information of the subsidiary, unless it is impracticable to do so." But note IFRS 10.
Each subsidiary decides which fiscal year variant it wants to use.
At the beginning of the new financial year, you need to clear this consolidated balance from your profit and loss accounts, but keep it for your balance sheet nominal accounts.
To achieve this, you must clear the balance of all nominal accounts in the parent, clear the consolidated balances in the each subsidiary and re-consolidate. Send an email to our authors to leave your feedback.
Your parent company could own less than a 50-percent stake in a subsidiary, and still exercise control on the basis of power afforded to it by dominance in the board or majority voting rights.
Prepare separate financial statements -- that is income statement, balance sheet and cash flow statement -- for the parent company and each subsidiary.