Question

Explain the treatment of non-controlling interest in the consolidated Statement of Comprehensive Inc

Answer 1

Non controlling interest is also referred to as minority interest. Non controlling interest is reported when the parent has more than 50% holding and less than 100% holding in its subsidiary. Under IFRS the minority interest should be recorded in the equity section of the parent but separate from the equity section of its parent. In the consolidated financial statements the minority interest is recorded as share of the minority's shareholders profit. To calculate the amount to be reported in the comprehensive income statement, first net income is calculated of the subsidiary and than it is multiplied by the minority share percentage. For Example, if the net income of minority is $ 20 million and the parent share is 75%, than $ 15 million would be minority income. This value would be reported as net income attributable to the minority interest as a separate non-operating item in the consolidated financial statements.