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Understanding Off-Balance Sheets   –  By Prof.  Simply  Simple ,[object Object],[object Object],[object Object]
[object Object],[object Object],[object Object],So what is the difference between an on & off balance sheet?
[object Object],[object Object],[object Object],[object Object],For Example…
What company A does is that it  puts the risky ventures of its subsidiary company B & any resulting payment/ expenses/losses  out  of its balance sheet and appears more healthy.
Companies have used off-balance sheet entities responsibly and irresponsibly for some time.  These separate legal entities were permissible under tax laws so that companies could finance business ventures by transferring the risk of these ventures from the parent to the off-balance-sheet subsidiary.
[object Object],[object Object],Now…
[object Object],[object Object],[object Object],[object Object],Giving you another example…
[object Object],[object Object],[object Object],[object Object],Also…
[object Object],[object Object],[object Object],Did you know that the Govt. does NOT incorporate oil bonds in its balance sheets?
[object Object],[object Object],[object Object],To Sum Up
[object Object],[object Object],In case of any query, please e-mail  [email_address]

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Off balance sheets

  • 1.
  • 2.
  • 3.
  • 4. What company A does is that it puts the risky ventures of its subsidiary company B & any resulting payment/ expenses/losses out of its balance sheet and appears more healthy.
  • 5. Companies have used off-balance sheet entities responsibly and irresponsibly for some time. These separate legal entities were permissible under tax laws so that companies could finance business ventures by transferring the risk of these ventures from the parent to the off-balance-sheet subsidiary.
  • 6.
  • 7.
  • 8.
  • 9.
  • 10.
  • 11.