Consolidated Financial Statements

All topics related to IFRS Standards.
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Asnake E
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Joined: 02 Oct 2019, 03:28

Consolidated Financial Statements

Post by Asnake E »

Hello

I have one question

Assume there is an individual investor with the following investments

1. A sole proprietorship business which is 100% owned by this investor alone
2. In a private limited company in which he has a controlling interest by owning 60% of the total shares of the company
3. In another company in which he has a shareholding of 20% of the total shares of the company

My question

Is there a need to prepare consolidated financial statements in this case?
JRSB
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Re: Consolidated Financial Statements

Post by JRSB »

Probably depends mostly on local company law.

Assumes that there is actually a group - the 100% and 60% investments are via a holding company or personally?
Asnake E
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Joined: 02 Oct 2019, 03:28

Re: Consolidated Financial Statements

Post by Asnake E »

Personally
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Marek Muc
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Re: Consolidated Financial Statements

Post by Marek Muc »

Does your company law require individual investors to prepare financial statements under IFRS?
Asnake E
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Re: Consolidated Financial Statements

Post by Asnake E »

No.

My ambiguity arises due to the fact that in our country IFRS applies to sole proprietorship businesses also (based on quantitative thresholds of revenue and total assets). As I indicated the individual has a sole proprietorship business. And as per the laws of our country, the individual and the sole proprietorship business are not legally separate.
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Marek Muc
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Re: Consolidated Financial Statements

Post by Marek Muc »

This is a question to your local lawyers I'm afraid
Asnake E
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Re: Consolidated Financial Statements

Post by Asnake E »

Thank you.
JRSB
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Re: Consolidated Financial Statements

Post by JRSB »

that concept is astonishing to me....so in effect a natural person is a parent/holding company.

Maybe if a person has such large holdings, a holding company is a good idea anyway...

which country is it?
Asnake E
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Re: Consolidated Financial Statements

Post by Asnake E »

Ethiopia.
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