what is meant by minority interest.
3 Replies
CA Ravi Sisodia
(CA,CS,CMA)
(32226 Points)
Replied 28 March 2010
What Does Minority Interest Mean?
1. A significant but non-controlling ownership of less than 50% of a company's voting shares by either an investor or another company.
2. A non-current liability that can be found on a parent company's balance sheet that represents the proportion of its subsidiaries owned by minority shareholders.
CA Ravi Sisodia
(CA,CS,CMA)
(32226 Points)
Replied 29 March 2010
for example
If ABC Corp. owns 90% of XYZ inc, which is a $100 million company, on ABC Corp.'s balance sheet, there would be a $10 million liability in minority interest account to represent the 10% of XYZ Inc. that ABC Corp does not own.
CA Ravi Sisodia
(CA,CS,CMA)
(32226 Points)
Replied 29 March 2010
as per AS-21 --
inority interest is that part of the net results of operations and of the net assets of a subsidiary attributable to interests which are not owned, directly or indirectly-through subsidiary(ies), by the parent.
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