What
is non controlling interest?
Non controlling interest
is the interest of the people who are not in controlling position i.e. people
other than parent. For example if company A buy 80% share in company B , it
means company A would control the company B , while 20%
shares which are held by people other than company A represent the non
controlling interest.
How
can we calculate Non controlling interest?
We can calculate non controlling
interest by two methods i.e. proportion of net asset methods and fair value
methods. In net asset method we multiply the percentage of non controlling interest
with net asset amount. In fair value method we determine the fair value of non
controlling interest. The fair value is determined normally by using the market
value of share.
