Asked by Vellanira Macado on Jun 05, 2024
Verified
Discuss the disadvantages of the sequential consolidation method.
Sequential Consolidation Method
A process of combining financial statements of a parent company and its subsidiaries one at a time in a specific sequence.
Disadvantages
Refers to the drawbacks or limitations that may hinder success or efficiency in a specific context.
- Familiarize oneself with the practices and core principles involved in multiple consolidation and the sequential consolidation approach.
Verified Answer
JS
Jontavia SandersJun 08, 2024
Final Answer :
Disadvantages of sequential consolidation method:
- Where there is tiered group (for example,five tiers)separate consolidations will be required for each tier in the group structure.
- However,each consolidation process is relatively simple compared to the multiple consolidation process.
- Where there is tiered group (for example,five tiers)separate consolidations will be required for each tier in the group structure.
- However,each consolidation process is relatively simple compared to the multiple consolidation process.
Learning Objectives
- Familiarize oneself with the practices and core principles involved in multiple consolidation and the sequential consolidation approach.
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