Home / CPA Course / BAR

Consolidation topics

BAR Chapter 16 · Area II · Blueprint II.G

Once a company controls others, it reports as one economic entity. BAR focuses on the parts of consolidation that need judgment and arithmetic: who controls (including through variable interest entities), how the noncontrolling interest is shown, which currency a foreign subsidiary really operates in, and how translation differences reach comprehensive income. Summit Outdoor Brands now owns 80% of Peakline Tents and all of Alpen GmbH in Germany, and has a stake in a financing vehicle it does not own but may control.

In this chapter

1. Control, the controlling interest and the NCI
2. Preparing the consolidated statements
3. Variable interest entities
4. Choosing the functional currency
5. Translation: the current rate method
6. Remeasurement: when the books are not in the functional currency
7. Presenting translation adjustments and the NCI

This chapter has 7 lessons, 50 practice MCQs with explanations and 20 simulations, plus flashcards and a recall sheet.

What this chapter covers

• Controlling and noncontrolling interests
• variable interest entities
• functional currency
• translation adjustments and their presentation

Chapter 15: Business combinations · Chapter 17: Derivatives and hedge accounting