Capital consolidation


The task of capital consolidation in a consolidated financial statement is to eliminate all internal financial interrelationships between companies included in a group, based on the one-entity principle. Therefore, in the course of capital consolidation, the holding company's interest in the included subsidiary company is offset against the apportionable share of the subsidiary company's equity. The law differentiates between two types of capital consolidation: the full consolidation and the pooling-of-interest method, which assumes different types of intercompany relationships between the holding company and the subsidiary.


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