Which of the following statements is incorrect with regards to non-controlling interests in subsidiaries?
A) The requirement to eliminate the effects of intragroup transactions does not hold when there are non-controlling interests.
B) The non-controlling interest's share in the dividends paid or proposed by the subsidiary is not eliminated on consolidation.
C) The non-controlling interest's share of the profits of the subsidiary is calculated after adjustments to eliminate income and expenses of the subsidiary that are realised from the economic entity's perspective.
D) Management fees paid in an intragroup transaction are considered realised when determining non-controlling interests in a subsidiary.

Question

Quizplus · Accepted Answer

The requirement to eliminate the effects of intragroup transactions holds regardless of whether there are non-controlling interests. This is because the consolidation process aims to present the financial statements of the group as if it were a single economic entity, eliminating all intragroup balances and transactions, including those involving non-controlling interests.

Which of the Following Statements Is Incorrect with Regards to Non-Controlling