In this article we will discuss about the advantages and disadvantages of holding company. The advantages of holding company are in brief: (1) A holding company is a legal personality and it is very easy to form a holding company because we simply have to purchase the controlling interest of other companies. (2) Each member of the group has to [...]
Here is a compilation of top nine problems on holding companies with its relevant solutions. Problem 1 (Wholly Owned Subsidiary): Note: Investment which is made by the Holding Company in the form of shares of subsidiary company is replaced by the subsidiary company's assets and liabilities. Problem 2 (Goodwill): The following are the Balance Sheet of H and S as [...]
The below mentioned article provides a short note on the Un-realised Profits arising from Transaction between the Holding Company and Subsidiary Company. Usually, there will be transactions between the holding company and the subsidiary company involving profits and losses. Suppose, H Ltd. (the holding company) buys from S Ltd. (the subsidiary company) goods of the value of Rs 20,000 on [...]