Where the shareholder's equity of a subsidiary is negative:
A) the NCI will be included as part of the parent interests.
B) the NCI will be shown as a separate amount in the consolidated accounts.
C) the NCI is ignored for consolidation purposes.
D) none of the above.

Question

Quizplus · Accepted Answer

When the shareholder's equity of a subsidiary is negative, the Non-Controlling Interest (NCI) will still be shown as a separate amount in the consolidated accounts. This treatment ensures that the financial position and results of the subsidiary are accurately reflected in the consolidated financial statements, including the interests not held by the parent company.

Where the Shareholder's Equity of a Subsidiary Is Negative