Subsidiary
Financial Dictionary — Consolidation & Groups
Definition
A subsidiary is an entity controlled by another entity, called the parent. Control usually exists when the parent owns more than 50% of the voting rights.
Detailed Explanation
A subsidiary is an entity controlled by a parent. Control typically involves power over relevant activities, exposure to variable returns, and ability to affect those returns.
Common Uses
- Used to explain the concept in accounting and business contexts.
- Used when training staff or documenting procedures and policies.
- Used when training staff or documenting procedures and policies.
Practical Example
- Example: Teams reference **Subsidiary** when defining terms in manuals, policies, or training materials.
Why This Term Matters
- Why it matters: Improves clarity and consistency across documentation and decision-making.