Difference Between Branch And Subsidiary
The major dissimilarities or differences between branch and subsidiary can be pointed out as follows:
1. Introduction
Branch: It is a part of business organization located in different places out side the head office.
Subsidiary: A company which owned, managed and controlled partially or fully by another parent company.
2. Legal Identity
Branch: It has no separate legal identity because it is just a segment of a company.
Subsidiary: It has a separate legal identity it is a fully registered company.
3. Liabilities Extended To
Branch: Parent company or head office
Subsidiary: To subsidiary company only
4. Name Of The Company
Branch: Parent company's name
Subsidiary: Entity name may be different from holding company
5. Books Of Accounts
Branch: Books of accounts are maintained jointly with the head office.
Subsidiary: Separate books of accounts are maintained
6. Reporting
Branch: To the head office of the company
Subsidiary: To the holding company of subsidiary company
Also Read:
Also Read:
7. Types Of Business
Branch: Same as parent company
Subsidiary: May be different than parent company
8. Ownership/Investment
Branch: Total investment is made by parent company and has 100% ownership
Subsidiary: 50 to 100% investment and ownership of holding company.
Branch Vs Subsidiary (Comparison Chart)
I hope this post is helpful to understand the difference between branch and subsidiary and to make comparison between them.
Branch Vs Subsidiary (Comparison Chart)
Basis
|
Branch
|
Subsidiary
|
Introduction
|
Part of a business company located in different places
|
A company owned and managed by another big company
|
Separate Legal Identity
|
No
|
Yes
|
Liabilities Extended To
|
Head Office
|
Subsidiary Company
|
Company Name
|
Name of parent company
|
May be different from holding company
|
Accounting
|
No separate books of account
|
Separate books of account
|
Reporting To
|
Head office
|
Holding company
|
Business Type
|
Same as the main company
|
May be different than the holding company
|
Ownership
|
Parent company
|
50 to 100 % of holding company
|
I hope this post is helpful to understand the difference between branch and subsidiary and to make comparison between them.
