The identification of the parent company and subsidiary company is an important requirement to determine the entity that must prepare the consolidated financial statements in accordance with the accounting regulations. The following Law Viet An would like to give the grounds to identify the parent company, subsidiary companies for businesses to further information.
Pursuant to the Law on Enterprise 2020, a company is considered the parent company of another company if it falls into one of the following cases:
In addition, Article 8 of Circular 202/2014/TT-BTC guiding the preparation and presentation of the consolidated financial statements also provides the grounds for determining the parent company by the right of control through domination of the financial statements. financial and operating policies so as to obtain benefits from the activities of this company, in particular:
The parent company has the right to govern the financial and operating policies in the following cases:
If you have requested for more advice on issues related to the model of subsidiaries and parent company, please contact Viet An Law Firm for more specific and detailed advice on this issue.
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