1. The company can consolidate the financial statements after achieving control of the subsidiary. In this case, the long-term equity investment of the parent company and the paid-in capital of the subsidiary, and the accounts receivable and payable between the parent company and the subsidiary company shall offset correspondingly. The shareholdings of the subsidiary held by the minority shareholders will be listed as minority shareholders' equity in the consolidated balance sheet.
2, The cash system is the accounting basis in which using the actual receipt and payment as the standard to deal with economic operations, determine the current income and expenses, calculate the profit and loss of the current period. In other words, all cash receipts and payments are recorded as income and expenses during the period in which they are incurred, regardless of whether the economic activities associated with the cash receipts and payments actually occurred.
The accrual system is the principle to determine the current period of income and expenses by the occurrence of rights and responsibilities. That is, income is recognized by the occurrence of creditor's rights, and expenses are recognized by the occurrence of debts, instead of recognizing revenue and expenses with cash income and payments.