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Template:Branches and affiliates: Difference between revisions
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'''[[Branch|Branches]]''': If a [[company]] is a person, think of a [[branch]] like an arm or a leg. A “[[branch]]” is a single office or presence of a larger [[legal entity]]. It does not have its own [[legal personality]] or [[creditworthiness]] — like an arm or a leg it is part of a greater whole. A [[branch]] may just be a single premises of the company — the “Muswell Hill branch of Sainsbury’s”, for example — but in the world of [[high finance]] it is usually whole presence of that [[legal entity]] in a given city or country. | '''[[Branch|Branches]]''': If a [[company]] is a person, think of a [[branch]] like an arm or a leg. A “[[branch]]” is a single office or presence of a larger [[legal entity]]. It does not have its own [[legal personality]] or [[creditworthiness]] — like an arm or a leg it is part of a greater whole. A [[branch]] may just be a single premises of the company — the “Muswell Hill branch of Sainsbury’s”, for example — but in the world of [[high finance]] it is usually whole presence of that [[legal entity]] in a given city or country. | ||
'''[[Affiliate]]s''': By contrast, a company’s [[affiliate]] is a related but separate [[legal entity]]. If a company is a person, its affiliate is its parent, child, or sibling. Parent affiliates are actually even called [[parent]]s. Children are [[wholly-owned subsidiaries]], ugly stepchildren and bastards are [[majority-owned subsidiaries]] and siblings are known as companies “under common ownership”. There is plenty of scope for ugly sisters, black sheep and long-lost cousins from Australia, as you can imagine. | |||
By contrast, a company’s [[affiliate]] is a related but separate [[legal entity]]. If a company is a person, its affiliate is its parent, child, or sibling. Parent affiliates are actually even called [[parent]]s. Children are [[wholly-owned subsidiaries]], ugly stepchildren are [[majority owned subsidiaries]] and siblings are known as companies “under common ownership”. | |||
[[Affiliate| | Proper [[Affiliate|affiliates]] may be consolidated from a financial reporting perspective, but generally (and unless it has specifically agreed to) an affiliate is not responsible for performing the obligations of its any of its affiliates, unless it agrees to do so by contract (such as a [[guarantee]]). | ||