Scope

This standard should be applied in the preparation and presentation of consolidated financial statements for a group of enterprises under the control of a parent.

IAS 27 should also be applied to accounting for investments in subsidiaries in a parent's separate financial statements.

The standard does not deal with:

• methods of business combinations (see IFRS 3);

• accounting for investments in associates (see IAS 28);

• accounting for investments in joint ventures (see IAS 31).

Key Definitions

Control: power to govern the accounting and financial policies of another entity so as to obtain benefits from its activities.

Subsidiary: an entity that is controlled by another (the parent).

Parent: an entity that has one or more subsidiaries.

Consolidated financial statements: financial statements of a group presented as those of a single economic entity.

Minority interest: portion of the net results and net assets of a subsidiary attributable to interests not owned directly or indirectly by the parent.

Presentation of Consolidated Financial Statements

A parent should present consolidated financial statements in which it consolidates its investments in subsidiaries in accordance with IAS 27.

However, a parent need not present consolidated financial statements if, and only, if:

• the parent itself is a 100% owned subsidiary or is partially owned by another entity whose owners have been informed and do not object to the parent not preparing consolidated accounts; and

• the parent's debt or equity instruments are not traded...