In this article we will discuss about the advantages and disadvantages of holding company. The advantages of holding company are in brief: (1) A holding company is a legal personality and it is very easy to form a holding company because we simply have to purchase the controlling interest of other companies. (2) Each member of the group has to [...]
Here is a compilation of top nine problems on holding companies with its relevant solutions. Problem 1 (Wholly Owned Subsidiary): Note: Investment which is made by the Holding Company in the form of shares of subsidiary company is replaced by the subsidiary company's assets and liabilities. Problem 2 (Goodwill): The following are the Balance Sheet of H and S as [...]
In this article we will discuss about the Accounting Treatment Relating to Preference Shares of a Subsidiary Company. A subsidiary company may have issued equity shares as well as preference shares. In such a case, irrespective of the percentage of preference shares held by outsiders, the minority interest will include the paid up value of the preference shares held by [...]