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A roadmap to accounting for noncontrolling interests (2018)

This Roadmap provides Deloitte’s insights into and interpretations of the guidance on noncontrolling interests, primarily that in ASC 810-10 and ASC 480-10-S99. Throughout the Roadmap, new guidance has been added, examples related to some of the guidance included in the previous edition have been added or substantively revised, and minor edits have been made to improve clarity.

Although the accounting principles related to noncontrolling interests have been in place for many years, they can be difficult to apply. The relatively brief guidance on nonredeemable noncontrolling interests (ASC 810-101) has resulted in diversity in practice, while the guidance on redeemable noncontrolling interests (ASC 480-10-S99) is highly prescriptive and contains multiple policy elections. For these reasons, accounting for noncontrolling interests is a particularly challenging aspect of U.S. GAAP.

The guidance in this Roadmap presumes that (1) a parent has already established that consolidation of its subsidiary is appropriate under ASC 810-10 and (2) the equity interests of a subsidiary qualify for equity classification under ASC 480. Consequently, this Roadmap should be viewed as a companion publication to A Roadmap to Consolidation — Identifying a Controlling Financial Interest. While classification of equity interests is outside the scope of this publication, readers may refer to A Roadmap to Distinguishing Liabilities From Equity for extensive guidance on such matters.

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The Roadmap Series contains periodic collections of our accounting guidance on selected topics of broad interest to the financial reporting community.

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