When an investing company owns less than 50 percent of another company,the companies must prepare consolidated financial statements.

Question

Quizplus · Accepted Answer

When an investing company owns less than 50 percent of another company, it typically does not have to prepare consolidated financial statements, as it does not have control over the other company. Consolidated financial statements are generally required when there is control, often indicated by ownership of more than 50%.

When an Investing Company Owns Less Than 50 Percent of Another