{"id":125,"date":"2025-11-17T06:00:06","date_gmt":"2025-11-17T06:00:06","guid":{"rendered":"http:\/\/ecourse.co.uk\/8135\/?p=125"},"modified":"2025-11-16T19:44:31","modified_gmt":"2025-11-16T19:44:31","slug":"week-9-uw-20","status":"publish","type":"post","link":"https:\/\/ecourse.uk\/8135\/?p=125","title":{"rendered":"Week 8 [12] [CORE]: Group Accounts: Consolidated Income Statements"},"content":{"rendered":"<p><strong><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-1375\" src=\"https:\/\/ecourse.uk\/8135\/wp-content\/uploads\/2021\/11\/group-structure.jpg\" alt=\"\" width=\"389\" height=\"222\" srcset=\"https:\/\/ecourse.uk\/8135\/wp-content\/uploads\/2021\/11\/group-structure.jpg 449w, https:\/\/ecourse.uk\/8135\/wp-content\/uploads\/2021\/11\/group-structure-300x171.jpg 300w\" sizes=\"auto, (max-width: 389px) 100vw, 389px\" \/><\/strong><\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_80 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#CORE_Group_structures_parent_companies_and_subsidiaries_joint_ventures_and_associated_companies\" >[CORE] Group structures, parent companies and subsidiaries, joint ventures and associated companies<\/a><ul class='ez-toc-list-level-5' ><li class='ez-toc-heading-level-5'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#Resource_Checklists\" >Resource Checklists<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-5'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#Essential_core_learning_and_study_resources_referred_to_in_this_post\" >Essential core learning and study resources referred to in this post:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-5'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#Additional_resources\" >Additional resources:<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#CORE_Directed_Private_Study_%E2%80%93_numerical_work_%E2%80%93_group_income_statements\" >[CORE] Directed Private Study &#8211; numerical work &#8211; group income statements<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#CORE_Intercompany_trading\" >[CORE] Intercompany trading<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#Corporate_strategy_%E2%80%93_Why_have_subsidiaries\" >Corporate strategy &#8211; Why have subsidiaries?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#Legal_issues_%E2%80%93_What_is_a_subsidiary\" >Legal issues &#8211; What is a subsidiary?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#CORE_Two_Worked_Case_Studies\" >[CORE] Two Worked Case Studies<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/ecourse.uk\/8135\/?p=125\/#ADD_Video_overview\" >[ADD] Video overview<\/a><\/li><\/ul><\/nav><\/div>\n<h4><span class=\"ez-toc-section\" id=\"CORE_Group_structures_parent_companies_and_subsidiaries_joint_ventures_and_associated_companies\"><\/span><strong>[CORE] Group structures, parent companies and subsidiaries, joint ventures and associated companies<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<h5><span class=\"ez-toc-section\" id=\"Resource_Checklists\"><\/span><strong>Resource Checklists<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h5>\n<h5><span class=\"ez-toc-section\" id=\"Essential_core_learning_and_study_resources_referred_to_in_this_post\"><\/span><strong>Essential core learning and study resources referred to in this post:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h5>\n<ul>\n<li>An introduction to group financial statemenets &#8211; elearning resource [A]<\/li>\n<li>A self study workbook on the preparation of group income statements [B]<\/li>\n<li>A worksheet on the adjustments in group financial statements for intercompany trading [C]<\/li>\n<\/ul>\n<h5><span class=\"ez-toc-section\" id=\"Additional_resources\"><\/span><strong>Additional resources:<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h5>\n<ul>\n<li>Why have subsidiaries [D]<\/li>\n<li>Legal definitions [E]<\/li>\n<\/ul>\n<hr \/>\n<p>Almost all economically significant companies conduct their business through group structures i.e. through subsidiaries, associated companies and joint ventures. This is because there are significant operating, managerial, financial and strategic advantages by organising the enterprise in this way. The companies you will be looking at as part of your other studies and research activities will all be groups of companies. So, you really do need to understand the financial statements for these groups.<\/p>\n<p>In this session we will start looking at the features of consolidated financial statements [group accounts]. We&#8217;ll look at the nature of a group, and the holding company\/subsidiary relationship. We&#8217;ll see how this is based on <em><strong>control<\/strong> <\/em>rather than <em><strong>ownership<\/strong><\/em>, and the consolidated financial statements that holding companies are required to prepare and publish are based on this concept of control.<\/p>\n<p><strong>You can see the online notes as an elearning resource <a href=\"https:\/\/ecourse.co.uk\/groups\/index.html\" target=\"_blank\" rel=\"noopener noreferrer\">here<\/a> &#8211; <em>essential <\/em>[A]<\/strong><\/p>\n<hr \/>\n<h4><span class=\"ez-toc-section\" id=\"CORE_Directed_Private_Study_%E2%80%93_numerical_work_%E2%80%93_group_income_statements\"><\/span><strong>[CORE] Directed Private Study &#8211; numerical work &#8211; group income statements<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>There is a printed <a href=\"https:\/\/www.ecourse.co.uk\/consolidations\/consolpl_2020.pdf\" target=\"_blank\" rel=\"noopener noreferrer\"><strong>online guide<\/strong><\/a> (<em><strong>essential<\/strong><\/em><strong> [B] <\/strong>to the preparation of consolidated income statements. Guidance will be given in the lecture sessions as to which parts of this material you need to cover.<\/p>\n<hr \/>\n<h4><span class=\"ez-toc-section\" id=\"CORE_Intercompany_trading\"><\/span><strong>[CORE]<\/strong> Intercompany trading<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>There&#8217;s also a worksheet on <strong><a href=\"http:\/\/ecourse.co.uk\/materials\/consolidations\/worksheet1.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">intercompany trading<\/a><\/strong> &#8211; <em><strong>essential <\/strong><\/em><strong>[C] <\/strong>and consolidated income statements as this can be a tricky issue for accounting students.<\/p>\n<hr \/>\n<p><strong>[CORE]<\/strong> There are also two additional pieces of elearning which will help you understand more fully the <em><strong>strategic and legal issues<\/strong><\/em> surrounding subsidiaries<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Corporate_strategy_%E2%80%93_Why_have_subsidiaries\"><\/span><strong>Corporate strategy &#8211; Why have subsidiaries?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>There is an\u00a0<strong><a href=\"http:\/\/ecourse.co.uk\/media\/whysubs\/index.html\" target=\"_blank\" rel=\"noopener noreferrer\">online presentation<\/a> [D]<\/strong> on why companies have subsidiaries. It lasts about 10 minutes but covers a lot in that time. You can, of course, take it at your own pace. It may appear a bit dated now, and some of the links in the resources box no longer all work, but it\u2019s still good stuff. This material is self explanatory, so please include it in your own private study.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Legal_issues_%E2%80%93_What_is_a_subsidiary\"><\/span><strong>Legal issues &#8211; What is a subsidiary?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>There is also an online presentation on\u00a0<strong><a href=\"http:\/\/www.ecourse.co.uk\/media\/whatissub\/\" target=\"_blank\" rel=\"noopener noreferrer\">what is a subsidiary<\/a><\/strong> <strong>[E]<\/strong> \u2013 again fairly good stuff, if a bit legalistic. It contains some good quizzes that will really test your understanding! The references are to the <strong><a href=\"http:\/\/www.legislation.gov.uk\/ukpga\/2006\/46\/pdfs\/ukpga_20060046_en.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">Companies Act 2006<\/a>\u00a0<\/strong>(downloadable pdf) or<strong>\u00a0<a href=\"http:\/\/www.legislation.gov.uk\/ukpga\/2006\/46\/contents\" target=\"_blank\" rel=\"noopener noreferrer\">here<\/a>\u00a0<\/strong>(online version).<\/p>\n<hr \/>\n<h4><span class=\"ez-toc-section\" id=\"CORE_Two_Worked_Case_Studies\"><\/span><strong>[CORE] Two Worked Case Studies<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><strong>These help you check your understanding<\/strong><\/p>\n<p>Have a go at\u00a0<strong><a href=\"https:\/\/ecourse.co.uk\/materials\/consolidations\/q_danser.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">Danser and Empart<\/a>.<\/strong><\/p>\n<p>and &#8211; <strong><a href=\"http:\/\/ecourse.co.uk\/materials\/consolidations\/q_brojum.pdf\">Brojum and Drorral<\/a><\/strong>.<\/p>\n<hr \/>\n<h4><span class=\"ez-toc-section\" id=\"ADD_Video_overview\"><\/span><strong>[ADD]<\/strong> <strong>Video overview<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>Here&#8217;s a video of an online session recorded last year. You&#8217;ll need a password &#8211; it&#8217;s 83408.<\/p>\n<p><iframe loading=\"lazy\" src=\"https:\/\/player.vimeo.com\/video\/413597924\" width=\"640\" height=\"360\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\" data-mce-fragment=\"1\"><\/iframe><\/p>\n","protected":false},"excerpt":{"rendered":"<p>[CORE] Group structures, parent companies and subsidiaries, joint ventures and associated companies Resource Checklists Essential core learning and study resources referred to in this post: An introduction to group financial statemenets &#8211; elearning resource [A] A self study workbook on the preparation of group income statements [B] A worksheet on the adjustments in group financial [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[2,3],"tags":[],"class_list":["post-125","post","type-post","status-publish","format-standard","hentry","category-elearning","category-lectures"],"_links":{"self":[{"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=\/wp\/v2\/posts\/125","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=125"}],"version-history":[{"count":33,"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=\/wp\/v2\/posts\/125\/revisions"}],"predecessor-version":[{"id":1758,"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=\/wp\/v2\/posts\/125\/revisions\/1758"}],"wp:attachment":[{"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=125"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=125"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ecourse.uk\/8135\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=125"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}