Minority Interest (Income Statement)

Category

Income Statement

Units

Currency

US-GAAP elements

NetIncomeLossAttributableToNoncontrollingInterestMinorityInterestInNetIncomeLossOfConsolidatedEntities

Reference

Regulation S-X Rule 5-03.19 (Net income attributable to the noncontrolling interest); ASC 810

Source

Reported in SEC EDGAR filings (US-GAAP XBRL taxonomy)

Minority interest on the income statement is the portion of a company's consolidated net income or loss that belongs to outside shareholders of subsidiaries the company controls but does not wholly own. It is subtracted from consolidated net income to arrive at net income attributable to the parent company's shareholders.

US GAAP now calls this net income attributable to noncontrolling interest. SFAS 160, now part of ASC 810, replaced the older term minority interest, which remains common in financial data.

When a company controls a subsidiary, it consolidates all of the subsidiary's revenue and expenses, even if outside investors own part of it. Under ASC 810, the consolidated income statement shows net income for the whole group and then attributes it between the parent and the noncontrolling holders. Regulation S-X Rule 5-03.19 gives the noncontrolling share its own caption, directly after net income. The current XBRL element is NetIncomeLossAttributableToNoncontrollingInterest. The older element, MinorityInterestInNetIncomeLossOfConsolidatedEntities, was deprecated and appears only in older filings.

The amount can be positive or negative. If a partly owned subsidiary loses money, the outside owners absorb their share of the loss, which increases the parent's net income relative to consolidated income. Losses are attributed to noncontrolling holders even if this pushes their balance-sheet interest below zero. Because the figure reflects the subsidiaries' results rather than the parent's, it can move independently of the parent's own business.

On the balance sheet, the matching item is noncontrolling interest within equity. Analysts calculating enterprise value add noncontrolling interest to the capital base because consolidated EBITDA and EBIT include 100 percent of subsidiaries' earnings. Large minority interest charges signal that a meaningful share of reported profit belongs to other investors, which matters when comparing consolidated margins with earnings per share.