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A noncontrolling interest (NCI) is the equity interest in a subsidiary that is not attributable, directly or indirectly, to a parent. This chapter discusses the accounting for partial acquisitions, step acquisitions, and changes in a company’s NCI in a business pursuant to ASC 810-10. The initial recognition and subsequent measurement of NCI is addressed in BCG 6. NCI valuation considerations are discussed in FV 7.3.5.
For changes in ownership interest in an asset or group of assets that do not constitute a business, or for changes in ownership in a legal entity that is a variable interest entity (VIE) that is not a business, the appropriate consolidation or derecognition model should be identified, which may be different from the guidance for a business. See PPE 2 and PPE 6 for additional guidance on asset acquisitions and asset disposals, respectively. See CG 6.1 and BCG 2.11 for additional guidance on accounting for a legal entity that is a VIE that is not a business.
A reporting entity may incur exit or restructuring costs in conjunction with a disposal of a business or a change in interest. ASC 420-10, Exit or Disposal Cost Obligations, addresses the recognition, measurement, and reporting of costs associated with exit and disposal activities, including restructuring activities. See PPE 6.4 for additional details.
The examples provided in this chapter assume a simple equity structure (i.e., one class of common shares). Other issues may arise if a subsidiary that is a business has a complex equity structure.

PwC. All rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.

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