The conceptual framework concept and the allocation of incomes in the consolidated entity: Its impact on financial ratios Available to Purchase

The majority stockholders are not the same as parent company stockholders in a consolidated entity when one or more subsidiaries own parent company’s shares. In this milieu, the allocation of income could be performed: a) among majority and minority stockholders; b) among parent company stockholders and minority stockholders. Considering minority interest as a component of the consolidated equity, this paper demonstrates how the criterion used to allocate income can influence on the consolidated financial statements and, thereby, analysis based these financial statements.