80 HASKINS & SELLS October
Finney, H. A. Consolidated Statements
for Holding Company and Subsidiaries.
(New York, Prentice-Hall, Inc., 1922.
There is so much of intricacy involved
in consolidated statements that one must
needs observe care in passing judgment on
a book of this kind without having examined
it most critically. One thing is certain,
namely, the book fills a long felt want.
On general examination, it appears to
cover the subject well, and in an interesting
manner. It is so filled with figures that
only through a careful study of the contents
with the significance indicated by
the figures may the full value of the work
be obtained. The chapter on unrealized
inter-company profits stands out as one of
the best chapters in the book, the discussion
of this complicated subject being unusually
clear. While it is probably irrelevant
to mention it, the fact remains that
one continues to wish for some suggestion
as to an easy method of determining the
amount of inter-company profit involved
in any given situation. The author, like
all others, assumes an amount of profit
for purposes of illustration. The accountant,
in practice, has to scratch his head
many times in order to determine the
amount of profit involved.
A valuable point brought out in the book
has to do with holdings of no par value
stock. On this subject the author says:
"The method of making eliminations is
not affected by the fact that the subsidiary's
stock has no par value. The
book value of the holding company's
ownings is determined by ascertaining the
per cent. of subsidiary stock owned, and
by eliminating this percentage of the subsidiary's
stock and surplus accounts."
In addition to matters usually discussed
in a treatment of this subject there are the
following miscellaneous topics: book value
at acquisition in excess of cost; minority
interest in a subsidiary with a deficit;
stock acquired by subscription from subsidiary;
subscription rights; holdings of
both in a preferred stock; stock dividends;
arbitrary entries in investment account.
In order to make the book adaptable
for instruction purposes, there are review
exercises and problems.
PRESS OF WILLIAM GREEN, NEW YORK