Back to basics: Consolidation–Presentation and disclosure

To close out our four-part Back to basics discussion on consolidation accounting, we turn to presentation and disclosure. In this episode, we discuss how consolidated entities are reflected in the financial statements, the disclosure requirements for both variable interest entities (VIEs) and voting interest entities (VOEs), and what a company may need to disclose when it holds an interest in a VIE but does not consolidate it.

Key topics and timestamps

• 2:28 – The purpose of consolidated financial statements and the guiding frameworks
• 6:20 – General consolidation presentation and disclosure principles
• 8:28 – Principles and objectives for the presentation and disclosure of variable interests in VIEs, including from the perspective of: 
  • 12:51 – A holder of variable interests in a VIE, regardless of primary beneficiary status
  • 14:51 – A primary beneficiary of a VIE
  • 16:47 – An entity with variable interests in VIEs for which it is not the primary beneficiary
• 21:05 – Presentation and disclosure for VOEs

Additional resources

This episode is part of our Back to basics series, where throughout the year we’ll revisit core accounting topics. This is the fourth and final episode focused on consolidation. In the first three episodes, we covered the foundations of consolidation accounting, how to determine whether an entity is a VIE, and how to identify which party, if any, should consolidate a VIE.

• Back to basics: Consolidation–Getting started
• Back to basics: Consolidation–Identifying a VIE
• Back to basics: Consolidation–Determining the primary beneficiary

Looking for more guidance on consolidation accounting? See PwC’s Consolidation guide. For more on consolidation presentation and disclosure, see chapter 18 of our Financial statement presentation guide. Also, follow this podcast on your favorite podcast app and subscribe to our weekly newsletter to stay in the loop.

About our guests

Alexander Martin is a partner in PwC's Deals practice who specializes in helping clients solve complex accounting, financial reporting, and business issues arising from deals, structured transactions, and other transformational events. With over 15 years of experience, Alexander has deep expertise in US GAAP and SEC reporting, gained through his roles as an advisor in PwC's Deals practice, a regulator at the SEC, and most recently as a partner in PwC's National Office.

Matt Sabatini is a deputy chief accountant in PwC's National Office who helps clients and engagement teams navigate the accounting and financial reporting for complex transactions. He specializes in the accounting for M&A, consolidations, corporate reorganizations, recapitalizations, joint ventures, and other investments.

About our guest host

Diana Stoltzfus is a partner in PwC’s National Office who helps to shape PwC’s perspectives on regulatory matters, responses to rulemakings and policy devel