Definition for : Proportionate consolidation

Proportionate Consolidation is used to consolidate the accounts of Joint ventures. Assets and Liabilities are transferred to the Parent company's Balance sheet only in proportion to the Parent company's Interest in the Joint venture. Likewise, the Joint venture's Revenues and Charges are added to those of the Parent company on the consolidated Income statement only in proportion to its participation in the Joint venture.

(See Chapter 6 Getting to grips with consolidated accounts of the Vernimmen)

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