Noncontrolling interests arise because a parent and its subsidiaries represent separate and distinct legal entities. Accordingly, each legal entity may separately prepare its own set of financial statements. Through the consolidation process, the financial statements are combined to present the parent and its subsidiaries as if they were a single economic entity. In recognition of their separate identities, it is possible for a parent and its subsidiaries to have different fiscal-year-end dates, the presence of which must be considered in the preparation of consolidated financial statements (see Sections 4.2 and 4.2.1).
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