An associate company (or associate) in accounting and business valuation is a company in which another company owns a significant portion of voting shares, usually 20?50%. In this case, an owner does not consolidate the associate's financial statements. Ownership of over 50% creates a subsidiary, with its financial statements being consolidated into the parent's books. Associate value is reported in the balance sheet as an asset, and dividends from the ownership are reported in the income statement. In Europe, investments into associate companies are called fixed financial assets.
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