luda002

Thanks for the response Andrew & Dreary.....I understand assets going up on the consolidation....But Can you explain if anything was reported on the balance sheet under the original equity method?

Also looking at reading 23 page 170 &171 in the CFAI book the example shows the consolidated balance sheet to have the same equity value.

This is because an unconsolidated balance sheet reports a one line amount for the SPE in assets and the consolidated reported both assets and liabilities so the net equity will still be the same but both assets and liabilities will be higher.