(IFRS) for Small and Medium-sized Entities (SMEs)

IFRS FOR SMES – JULY 2009Consolidation procedures9.13 The consolidated financial statements present financial information about thegroup as a single economic entity. In preparing consolidated financialstatements, an entity shall:(a)(b)(c)(d)combine the financial statements of the parent and its subsidiaries line byline by adding together like items of assets, liabilities, equity, income andexpenses;eliminate the carrying amount of the parent’s investment in eachsubsidiary and the parent’s portion of equity of each subsidiary;measure and present non-controlling interest in the profit or loss ofconsolidated subsidiaries for the reporting period separately from theinterest of the owners of the parent; andmeasure and present non-controlling interest in the net assets ofconsolidated subsidiaries separately from the parent shareholders’ equityin them. Non-controlling interest in the net assets consists of:(i)(ii)the amount of the non-controlling interest at the date of the originalcombination calculated in accordance with Section 19 BusinessCombinations and Goodwill, andthe non-controlling interest’s share of changes in equity since thedate of the combination.9.14 The proportions of profit or loss and changes in equity allocated to the owners ofthe parent and to the non-controlling interest are determined on the basis ofexisting ownership interests and do not reflect the possible exercise or conversionof options or convertible instruments.Intragroup balances and transactions9.15 Intragroup balances and transactions, including income, expenses and dividends,are eliminated in full. Profits and losses resulting from intragroup transactionsthat are recognised in assets, such as inventory and property, plant andequipment, are eliminated in full. Intragroup losses may indicate an impairmentthat requires recognition in the consolidated financial statements (see Section 27Impairment of Assets). Section 29 Income Tax applies to temporary differences thatarise from the elimination of profits and losses resulting from intragrouptransactions.Uniform reporting date9.16 The financial statements of the parent and its subsidiaries used in the preparationof the consolidated financial statements shall be prepared as of the samereporting date unless it is impracticable to do so.© IASCF 45