Minority Interest

When Company A acquires Company B, minority interest represents the equity interest of outside shareholders in consolidated subsidiaries. If the two companies are treated as if they are one for financial statement purposes, an account (minority interest) must be presented to indicate that all the assets and liabilities are not related to Company A. On the balance sheet it appears between liabilities and shareholders’ equity. On the income statement, minority interest is shown as a deduction of consolidated net income.

Leave a Reply