controllati

Controllati is irregular Italian usage in corporate finance, referring to subsidiary companies that are under the control of a parent entity. In common practice, a controllata is an entity whose activities and policies can be governed by another company, the controllante, typically a group or parent company.

Control is usually established by holding a majority of voting rights or by other arrangements that give the parent the power to direct the investee’s financial and operating policies in order to obtain benefits. This power can be achieved directly, through ownership of shares, or indirectly, via ownership of other intermediate companies. In some cases, control can be exercised even with less than a majority stake if the parent has de facto authority due to shareholder composition or contractual arrangements.

In international accounting, the concept of control is central to consolidation. Under IFRS 10, an investor controls an investee when it has power over the investee, exposure to, or rights to, variable returns, and the ability to use its power to affect those returns. When control exists, the parent consolidates the controllata in its consolidated financial statements, combining line by line assets, liabilities, income, and expenses. Non-controlling interests represent the portion of equity and results attributable to other shareholders not under the parent’s control.

Controllati can be domestic or foreign and may encompass various levels of corporate structure, including direct or indirect ownership. The term is often contrasted with affiliated or associated companies, where control is not present and equity-method accounting may apply.