Chrysler 2010 Annual Report Download - page 151

FIAT GROUP
CONSOLIDATED
FINANCIAL
STATEMENTS
AT 31 DECEMBER
2010
NOTES
150
Basis of consolidation
Subsidiaries
Subsidiaries are enterprises controlled by the Group, as defined in IAS 27 – Consolidated and Separate Financial Statements.
Control exists when the Group has the power, directly or indirectly, to govern the financial and operating policies of an enterprise
so as to obtain benefits from its activities. The financial statements of subsidiaries are combined in the consolidated financial
statements from the date that control commences until the date that control ceases. Non-controlling interests in the net
assets of consolidated subsidiaries and non-controlling interests in the profit or loss of consolidated subsidiaries are presented
separately from the interests of the owners of the parent in the consolidated statement of financial position and income
statement respectively. Losses applicable to non-controlling interests which exceed the minority’s interests in the subsidiary’s
equity are allocated against the non-controlling interests. Changes in the interests in a subsidiary which do not lead to the
acquisition or loss of control are recognised directly in equity.
Subsidiaries that are either dormant or generate a negligible volume of business, are not consolidated. Their impact on the
Group’s assets, liabilities, financial position and profit/(loss) attributable to the owners of the parent is immaterial.
Jointly controlled entities
Jointly controlled entities are enterprises over whose activities the Group has joint control, as defined in IAS 31 – Interests in
Joint Ventures. The consolidated financial statements include the Group’s share of the earnings of jointly controlled entities
using the equity method from the date that joint control commences until the date that joint control ceases.
Associates
Associates are enterprises over which the Group has significant influence, but not control or joint control, over the financial and
operating policies, as defined in IAS 28 – Investments in Associates. The consolidated financial statements include the Group’s
share of the earnings of associates using the equity method, from the date that significant influence commences until the date
that significant influence ceases. When the Group’s share of losses of an associate, if any, exceeds the carrying amount of the
associate in the Group’s balance sheet, the carrying amount is reduced to nil and recognition of further losses is discontinued
except to the extent that the Group has incurred obligations in respect of the associate.
Investments in other companies
Investments in other companies that are available-for-sale financial assets are measured at fair value, when this can be reliably
determined. Gains or losses arising from changes in fair value are recognised directly in other comprehensive income until the
assets are sold or are impaired, when the cumulative gains and losses previously recognised in equity are recognised in the
income statement of the period.
Investments in other companies for which fair value is not available are stated at cost less any impairment losses.
Dividends received from these investments are included in Other income (expenses) from investments.
Transactions eliminated on consolidation
All significant intragroup balances and transactions and any unrealised gains and losses arising from intragroup transactions
are eliminated in preparing the consolidated financial statements. Unrealised gains and losses arising from transactions with
associates and jointly controlled entities are eliminated to the extent of the Group’s interest in those entities.