Simple, holding more than 50% of the shares belongs to the scope of merger.

Consolidated financial statements should be determined on the basis of control (substance is more important than form principle)

Control refers to being able to decide the financial and business policies of another enterprise and gain benefits from the business activities of another enterprise.

In addition to the fact that the parent company directly or indirectly owns more than half of the voting rights, the following requirements are also considered as controls:

1, entrusted to manage the invested enterprise through agreements with other investors.

2. According to the company's articles of association or agreement, have the right to decide the financial and management policies of the invested entity.

3. Have the right to appoint or remove most members of the board of directors or similar institutions of the invested entity.

4. Have majority voting rights in the board of directors of the invested entity or similar institution. Potential voting rights such as convertible bonds should be considered.

5. Other requirements, such as the parent company mastering the sources of funds and main sales channels of its subsidiaries.