Would you please explain me what is the difference between affiliates
and subsidaries, and then if there is any difference in accounting
treatments.( i am asking these question w.r.t an investment co.)
2nd thing is how i will treat the personal expenses of a partner which
are being paid by the co. and where i have to show it in the balance


Dear Hameed

The shares of subsidiary company should be owned by holding company
but for affiliates, the relationship is a connected party.

Thanks and regards


Dear Simon

Thanx for your reply, dear would you please explian me more, i mean
w.r.t accounting treatments according to IAS or IFRS.


Hi Hameed,

If company A is subsidiary of company B means company B is having
controlling interest in company A. Generally speaking interest more
then 50%. Affiliates is more used as an interest in associate rather
then interest in subsidiary. Where Company A is the associate of
company B means company B is having considerable interest in the
company A but not enough to hold the control of the company A.
Generally interest between 20% to 49%.

Treatment for ppersonal expense of partners paid by the company mainly
depends of your company policy. You can treat as Loan to partners and
charged interest at the year end.

I hope above is helpful.


Dear hameed,
For example Company A owns shares in Company B (non-controlling
shares) then B would be a subsidiary of A and A would be Parent of B.
Now, if a Director own a certain percentage of shares in company C,
then A, B and C would all be associate companies. Percentage to be
held may be different or there may be other criterias also. for
example in Pakistan if a Director holds at least 10% shares in another
company then both companies are treated as Associates.For accounting, presentation purposes IAS 37 read with other relevant
IASs 9if applicable) would apply for Subsidiary and for Associate
company, IAS ‘Investment in Associates’ would apply along with the
disclosure requirements for ‘Related Parties’ under other IASsI’m really sorry that right now I don’t remember the Nos. of above
referred IASs but I’ll post it for you soon.Regards,Zulfiqar