Study On The Change Of Consolidation Scope Based On Control Judgment

BT is a common form of cooperation between government and enterprises,and this form of cooperation is also used between enterprises and enterprises.When investors set up the item company to operate the project,the investor need to judge whether the investee should be involved in the consolidated financial statement or not.Due to the complex arrangement of BT projects,the control judgement of investors is complex.There exists the situation that control judgement and consolidation scope may change at different stages or under different conditions.This paper shows that there exist such cases in the practice through case analysis,and it's difficult to summarize an appropriate accounting treatment.Therefore,the government need to develop relevant guidelines document to illustrate the enterprises how todo the accounting treatment under such situation.This paper introduces the consolidation theories,then analysesthe change of the definition of control in both domestic and international accounting standards and the standard of control according to the current accounting standard in China.At last,this paper introduces the influence of control judgement on consolidation scope.In addition to the theoretical analysis,this paper takes the cooperation project between Guangdong Mingzhu Group Co.,Ltd and the local government as a case study.This paper analyses the nature of the investment,and then judge whether or not Guangdong Mingzhu Group Co.,Ltd controls the item company.According to analysis,the control will change at different stages or under different conditions,and the consolidation scope will change frequently.Guangdong Mingzhu Group Co.,Ltd is difficult to do the accounting treatment.Lastly,the paper give several suggestions on this basis.Through theoretical investigation and case study,this paper shows that there exists such a situation that the consolidation scope of the same matter may change at different stages or under different conditions.It will cause that the consolidation scope will change frequently and the enterprise is difficult to do the accounting treatment.Lastly,the paper give several suggestions on this basis.