Accounting · Consolidated Financial Statements
Which of the following statements is true regarding the Fair Value Method for Non-Controlling Interest (NCI) after the acquisition date?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The Fair Value Method requires NCI to be measured at the acquisition date only, and not adjusted for post-acquisition movements.
- 2The Fair Value Method is the only acceptable method under IFRS for measuring NCI.
- 3The Fair Value Method ensures the NCI's share of post-acquisition reserves is calculated based on its percentage holding.✓
- 4The Fair Value Method ensures NCI is valued at a proportional share of the subsidiary's net assets at the acquisition date.
Correct answer
The Fair Value Method ensures the NCI's share of post-acquisition reserves is calculated based on its percentage holding.
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