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    Rules consolidating subsidiaries

    Consolidated accounting is used to group the financial information of a parent company and one or more subsidiary companies.A parent company owns the majority of voting shares of a subsidiary company or otherwise has contractual control of the subsidiary.(Download Free Acrobat Reader) FASB Accounting Standards Updates are copyrighted by the Financial Accounting Foundation, 401 Merritt 7, Norwalk, Connecticut 06856. No part of the FASB Accounting Standards Updates may be further reproduced, stored in an archival or retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, other than printing a single copy for individual personal non-commercial purposes, without the prior written permission of the Financial Accounting Foundation.Any links to the ASUs on your website must be directed to this page and not to the individual documents so that users understand the requirements and conditions for the use of ASUs.

    In the United States railroad industry, an operating subsidiary is a company that is a subsidiary but operates with its own identity, locomotives and rolling stock.

    This information is also reported on the income statement of the parent company.

    This is used when the parent company holds a majority stake by controlling more than 50% of the subsidiary business.

    A subsidiary is defined as an entity that is controlled by another entity.

    Therefore, the definition of control is of primary concern in determining whether or not consolidated financial statements should be prepared.

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