1 Groups and consolidation: an overview

 
413 
in another way that Smith Co does have significant influence over Yellow Co, Yellow Co would be 
classified as an associate.
Aquamarine Co is an 
associate
of Smith Co, as Smith Co holds more than 20% of the voting rights of 
Aquamarine Co and is therefore presumed to have significant influence over Aquamarine Co.
 
 
4
Content of consolidated financial statements 
Consolidated financial statements present the results of the group; they do not replace the separate 
financial statements of the individual group companies.
It is important to note at this point that consolidated financial statements are an
 
additional
set of 
financial statements that are produced. They do not replace the individual financial statements of the 
parent or its subsidiaries. The group itself has no legal form, the group accounts are produced to satisfy 
accounting standards and, in some countries, legal requirements.
Consolidated financial statements are issued to the shareholders of the parent and provide information for 
those shareholders on all the companies controlled by the parent. 
Most parent companies present their own individual accounts and their group accounts in a single 
package
. The package typically comprises the following. 

Parent company financial statements
, which will include 'investments in subsidiary undertakings' 
as an asset in the statement of financial position, and income from subsidiaries (dividends) in the 
statement of profit or loss and other comprehensive income 

Consolidated statement of financial position

Consolidated statement of profit or loss and other comprehensive income
(the other 
comprehensive income element of consolidated financial statements is beyond the scope of the 
FFA/FA syllabus) 
