A form of corporate restructuring in which a parent firm sells shares in a subsidiary through an initial public offering (IPO).
The consolidated statement of financial position, often referred to as the consolidated balance sheet, provides a snapshot of a parent and its subsidiaries’ financial situation at a specific point in time.
A controlled corporation is a company whose policies and major decisions are determined by another firm, which owns more than 50% of its voting shares.
Dominant influence refers to the power exerted over a company to control its operating and financial policies, potentially treating it as a subsidiary within group accounts.
An equity carve-out is a type of corporate restructuring process that involves a parent company selling a minority share of a subsidiary to the public through an initial public offering (IPO). This allows the parent company to raise capital while maintaining control over the subsidiary.
This concept outlines the specific circumstances under which a subsidiary may be excluded from consolidation in a parent company's financial statements under the Financial Reporting Standard Applicable in the UK and Republic of Ireland. This ensures the financial statements provide a true and fair view.
A foreign company, or overseas company, is a company incorporated outside the UK but has a subsidiary or established place of business within the UK. These companies are subject to provisions of the Companies Act 2006 relating to registration, accounts, constitution, directors, name, etc.
A holding company is a type of corporation that owns other companies' outstanding stock. Its primary purpose is to own shares of other companies to form a corporate group.
An immediate holding company has a controlling interest in another company but is itself controlled by a third company, commonly known as the holding company. It plays a key role in corporate structure and governance.
An investment centre is a unit or division within an organization where capital expenditures are made under the specific oversight of management responsible for that centre. This focus allows for detailed accountability and efficient resource management.
A letter provided to a bank by the parent company of a subsidiary applying for a loan, offering informal assurance without a formal guarantee of repayment responsibility.
Non-Controlling Interest (NCI) is a term in International Financial Reporting Standards (IFRS) used to describe the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent company.
A Special Purpose Vehicle (SPV) or Special Purpose Entity (SPE) is a subsidiary created by a parent company to isolate financial risk. Its legal status as a separate company allows separation of the parent organization from financial risk.
A type of corporate restructuring wherein a parent company divests itself of a wholly owned subsidiary by distributing shares in the latter to its own shareholders, making the subsidiary an independent company. This process often aims to increase shareholder value and improve the focus of both entities.
A type of corporate restructuring in which a parent company divests itself of a wholly owned subsidiary by giving its shareholders the opportunity to exchange their shares for shares in the subsidiary, thereby making it an independent entity. Unlike a spin-off where shares are distributed automatically, in a split-off, the parent company makes a tender to its shareholders, who can choose whether or not to acquire shares in the new company.
A subsidiary is an undertaking that is controlled by another undertaking, often referred to as the holding or parent company. The specific criteria for what constitutes control are defined by legislation, such as the Companies Act. Typically, a subsidiary's financial statements are consolidated into the financial statements of the parent company.
An ultimate holding company, also known as an ultimate parent company, is a company that holds a dominating position over a group of firms, including those subsidiaries that act as immediate holding companies for their own subsidiaries.
In various contexts, a unit can represent either a standard measure used in transactions or a division within a larger entity, such as a business or organization.
