Science and Technology Information Research Institute, Shandong University of Technology, Zibo, P.R. China, 255049

摘要

According to China's Enterprise Accounting Standards requirement, when an investor company has adopted a joint holding company, it should prepare consolidated financial statements. On the current situation, there are two theories for the consolidated financial statements report, and one of which is the entity theory. This article intended to make an analysis to the entity theory, and gives its corresponding E-R model, then, reveals the limitations of this theory by analysis to the model. Based on above research, the article gives the optimized E-R model of the theory. The expected significance of the study is just as following: the research results are to be helpful to improve the financial reporting entity theory.