Subsidiary
AccountingA company controlled by another, consolidated into its accounts.
In plain terms
The statement of subsidiaries names exactly which one is losing money.
1492 terms
Glossary
Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.
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Subsidiary opacity
Fundamental analysisLosses, debt or transactions parked in subsidiaries — often overseas ones — where they are harder to examine.
In plain terms
It shows as a large and growing gap between standalone and consolidated profit. A parent that looks healthy alone and weak consolidated is telling you where to look.
Material subsidiary
Regulation & taxA subsidiary whose income or net worth exceeds a defined share of the listed group’s consolidated figures, attracting extra governance obligations under the listing regulations.
In plain terms
A subsidiary large enough that it cannot be governed entirely out of sight. The threshold has been tightened over the years, so read the current definition rather than a remembered one.
Corporate guarantee
AccountingA parent company guaranteeing the borrowings of a subsidiary or group entity.
In plain terms
Not your debt until it is. Add guarantees to debt when stress-testing leverage.
DICGC
Regulation & taxAlso called: Deposit Insurance and Credit Guarantee Corporation
The Deposit Insurance and Credit Guarantee Corporation, a wholly owned subsidiary of the Reserve Bank that insures deposits at covered banks.
In plain terms
Cover is automatic, the bank pays the premium and you cannot opt out. It pays up to the prescribed limit per depositor per bank, net of anything you owe that bank.
Foreign currency translation reserve
AccountingAlso called: FCTR
The reserve accumulating exchange differences arising on translation of an overseas subsidiary’s accounts into the reporting currency.
In plain terms
It can build quietly across six years of annual reports and is only properly visible in the statement of changes in equity. It reaches the profit line exactly once — when that operation is disposed of, which may be never.
Minority interest
AccountingThe share of a subsidiary’s profit belonging to other shareholders.
In plain terms
Compute per-share figures after deducting it, or you overstate earnings.
Translation effect
AccountingThe impact of exchange rates when converting a foreign subsidiary’s accounts.
In plain terms
It changes reported consolidated numbers without anything operational happening.
Cross-default clause
Fundamental analysisAlso called: Cross-default
A term defining a default under any other borrowing as a default under this one.
In plain terms
The transmission mechanism that turns one subsidiary's missed payment into a group-wide event, and the reason distress moves so much faster than the underlying deterioration did.
Registrar of Companies
Regulation & taxAlso called: RoC, ROC, MCA, Ministry of Corporate Affairs, AOC-4, MGT-7
The office under the Ministry of Corporate Affairs with which every Indian company, listed or not, files its incorporation details, annual accounts, annual return and charges.
In plain terms
Where an unlisted subsidiary’s own accounts live. The consolidated statement gives you one line; the registrar gives you that entity’s full balance sheet.
Standalone
AccountingAccounts covering the parent legal entity only.
In plain terms
Subsidiary profit appears only as dividends and subsidiary debt not at all. Rarely the right set.