Consolidation (business)

In business, consolidation or amalgamation is the merger and acquisition of many smaller companies into a few much larger ones. In the context of financial accounting, consolidation refers to the aggregation of financial statements of a group company as consolidated financial statements. The taxation term of consolidation refers to the treatment of a group of companies and other entities as one entity for tax purposes. Under the Halsbury's Laws of England, amalgamation is defined as "a blending together of two or more undertakings into one undertaking, the shareholders of each blending company, becoming, substantially, the shareholders of the blended undertakings. There may be amalgamations, either by transfer of two or more undertakings to a new company or the transfer of one or more companies to an existing company". Consolidation is the practice, in business, of legally combining two or more organizations into a single new one. Upon consolidation, the original organizations cease to exist and are supplanted by a new entity. Access to new technologies/techniques Access to new clients Access to new geographies Cheaper financing for a bigger company Seeking for hidden or nonperforming assets belonging to a target company (e.g. real estate) Bigger companies tend to have superior bargaining power over their suppliers and clients (e.g. Walmart) Synergies There are three forms of business combinations: Statutory Merger: a business combination that results in the liquidation of the acquired company's assets and the survival of the purchasing company. Statutory Consolidation: a business combination that creates a new company in which none of the previous companies survive. Stock Acquisition: a business combination in which the purchasing company acquires the majority, more than 50%, of the Common stock of the acquired company and both companies survive. Variable interest entity Parent-subsidiary relationship: the result of a stock acquisition where the parent is the acquiring company and the subsidiary is the acquired company.

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Minority interest

In accounting, minority interest (or non-controlling interest) is the portion of a subsidiary corporation's stock that is not owned by the parent corporation. The magnitude of the minority interest in the subsidiary company is generally less than 50% of outstanding shares, or the corporation would generally cease to be a subsidiary of the parent. It is, however, possible (such as through special voting rights) for a controlling interest requiring consolidation to be achieved without exceeding 50% ownership, depending on the accounting standards being employed.

Associate company

An associate company (or associate) in accounting and business valuation is a company in which another company owns a significant portion of voting shares, usually 20–50%. In this case, an owner does not consolidate the associate's financial statements. Ownership of over 50% creates a subsidiary, with its financial statements being consolidated into the parent's books. Associate value is reported in the balance sheet as an asset, the investor's proportional share of the associate's income is reported in the income statement and dividends from the ownership decrease the value on the balance sheet.

Goodwill (accounting)

In accounting, goodwill is an intangible asset recognized when a firm is purchased as a going concern. It reflects the premium that the buyer pays in addition to the net value of its other assets. Goodwill is often understood to represent the firm's intrinsic ability to acquire and retain customer business, where that ability is not otherwise attributable to brand name recognition, contractual arrangements or other specific factors. It is recognized only through an acquisition; it cannot be self-created.

Annual Financial Closing 2019: Accounting and Consolidation

Covers the annual financial closing procedures for the year 2019 at EPFL, focusing on accounting principles, consolidation scopes, fund balancing, and deadlines.

Annual Closing 2022: Accounting Overview

Covers the annual closing procedures at EPFL for 2022, including presentations, financial documentation, inventory control, and transaction deadlines.

Financial Closing Instructions 2023

Offers comprehensive guidance on financial closing procedures for 2023, focusing on accurate reporting and efficient document validation.

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