Non-controlling interests in the equity of a subsidiary at the date of acquisition are reflected in Step 1 of the NCI allocation process.

Question

Quizplus · Accepted Answer

Non-controlling interests are accounted for in Step 1 of the NCI allocation process, which involves the determination of the fair value of the subsidiary's identifiable assets and liabilities at the date of acquisition. This fair value is then used to calculate the amount of goodwill or bargain purchase gain, as well as the initial carrying amount of the non-controlling interests.

Non-Controlling Interests in the Equity of a Subsidiary at the Date