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    Question

    A holding company is required to prepare consolidated

    financial statements. The financials of which of the following will be includes in the consolidated financials, by the holding company?
    A All its subsidiaries Correct Answer Incorrect Answer
    B All its associate companies Correct Answer Incorrect Answer
    C All its subsidiaries and joint venture companies Correct Answer Incorrect Answer
    D All its associate and joint venture companies Correct Answer Incorrect Answer
    E All its subsidiaries, associates and joint venture companies Correct Answer Incorrect Answer

    Solution

    A holding company is required to prepare consolidated accounts. Consolidated financial statements present the financial position and results of a group of companies (comprising the holding company and its subsidiaries and associate companies, including joint ventures) as if they were a single entity. This requirement ensures transparency and provides a complete picture of the financial health and performance of the entire group. This is a requirement as per Section 129 of the Companies Act too. The company shall also lay before the annual general meeting, such consolidated financials. 

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