The financial statements of legally separate entities may be issued to show the financial position and income as they would appear if the companies were one legal entity.Such statements reflect a legal,rather than an economic,concept of the entity.

Question

Quizplus · Accepted Answer

The financial statements that combine the financial position and income of legally separate entities as if they were one entity reflect an economic, rather than a legal, concept of the entity. This approach is used in consolidated financial statements and aims to present the economic substance over the legal form.

The Financial Statements of Legally Separate Entities May Be Issued