Question
The accounting standard suggests that all the identifiable assets and liabilities of the subsidiary must be recognized in the consolidated financial statements at fair value.
The accounting standard suggests that all the identifiable assets and liabilities of the subsidiary must be recognized in the consolidated financial statements at fair value. The accounting standard also suggests that previously unrecorded assets or liabilities (e.g., contingent liability) must be recognized at fair value.
Critically analyze whether the adjustments to fair value should be made in the books of the subsidiary or in the consolidation worksheet.
If the adjustments to fair value are made in the consolidation worksheet, critically analyze whether the equity account used remains in existence indefinitely.
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