Controlling interest is when a shareholder, or a group acting in kind,
holds a majority of a company's stock. The shareholder of a company
must own 50% plus one of the company's outstanding shares to be
considered the controlling financial interest. However, a single person
or group can achieve controlling interest if they own a significant
proportion of its voting shares even though they may own less than
50% of the company. Push down accounting is a bookkeeping method
used by companies when they buyout another firm. The acquirer's
accounting basis is used to prepare the financial statements of the
purchased entity. In the process, the assets and liabilities of the target
company are updated to reflect the purchase cost, rather than historical
cost. You can elect to use pushdown accounting in its separate financial
statements upon the occurrence of an event in which the acquirer
obtains control of the acquired entity. I think it would be important to
consider the pros and cons push down accounting will have in keeping or
removing the debt on future profitable acquisitions from a tax and
reporting perspective, and you must factor in the advantages and
disadvantages.
