Where investments should go in financial statements?
SUUZT
Registered Posts: 2
Where investments should go in financial statements?
0
Comments
-
I have just taken my financial statements exam and never came across an answer in the way you have worded yours but what I am guessing you are referring to is that someone has invested in a company and how is this recorded? If I am understanding your question correctly, the funds raised will increase the share capital under equity.0
-
If you mean investments made by the company, for example the company has bought shares in an other company then show them in non current assets. I would call them financial investments. They should be valued at fair value.
If you mean an investment in another company, and the holding is sufficient to classify the other company as a subsidiary or an associate you should do different things depending on whether you are looking at the parent company's own accounts or the accounts of the group as a whole.
The company's own accounts
Show the value of the investments within the non current assets
The group accounts
For the subsidiary - when you consolidate you remove the value of the investment so that the group accounts show the total assets and total liabilities of the parent and all the subsidiaries together.
For the associate - show the value of the investment as a single line on the Sof FP just below the other NCAsSandy
sandy@sandyhood.com
www.sandyhood.com0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 12.5K For AAT students
- 319 NEW! Qualifications 2022
- 157 General Qualifications 2022 discussion
- 11 AAT Level 2 Certificate in Accounting
- 56 AAT Level 3 Diploma in Accounting
- 92 AAT Level 4 Diploma in Professional Accounting
- 8.8K For accounting professionals
- 23 coronavirus (Covid-19)
- 272 VAT
- 92 Software
- 274 Tax
- 136 Bookkeeping
- 7.2K General accounting discussion
- 201 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 345 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 582 Job postings
- 16 Who can benefit from AAT?
- 36 Where can AAT take me?
- 42 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 66 AAT membership