Question

n consolidation, intragroup entries are different from BCVR entries. Why is it necessary to make adjustments for intragroup transactions?

Answer 1

Answer:-

Why is it necessary to make adjustments for intragroup transactions?

• The solidified monetary articulations are the announcements of the gathering, a monetary element comprising of the parent and its subsidiaries.
• The combined budgetary explanations at that point can just contain benefits, resources and liabilities that identify with gatherings outside to the group.
• Adjustments should then be made for intragroup exchanges as these are inner to the financial substance, and don't mirror the impacts of exchanges with outer parties.
• This is additionally steady with the element idea of combination, which characterizes the gathering as the net resources of the parent and the net resources of the auxiliary.
• Exchanges between these gatherings should then be balanced in full as the two gatherings are inside the monetary substance.

Note:-

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