In: Accounting
Explain a Father/Son/Grandson configuration compared to a direct ownership.
The father-son-grandson relationship refers to the business combination where the subsidiary companies of a pared: company are having more subsidiaries. The subsidiary company holds the control over its subsidiaries and the parent company holds control over all the subsidiaries.
Direct ownership refers to individuals and entities who directly own shares or are partners in any legal entity. E.g. If you own 10% of the shares in a particular entity, you become a direct owner. A direct owner need not necessarily be an individual (natural person) and can also be another entity as in the case where the parent company is a direct owner in its direct subsidiary. Indirect ownership is also possible. A person X can be an indirect owner, if other entities, in which he has shares, owns the entity e.g. if you own 50% shares of company A which owns 20% shares of company B then you are an indirect owner of company B.