An associate company is one in which another company owns/holds a significant percentage of shares, usually 10% or more, however, less than 50% . In this case, an owner does not consolidate the associate's financial statements(viz., Balance Sheet etc) with its own. Ownership of over 50% creates a subsidiary, with its financial statements being consolidated into the parent (holding) company's books.
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Both these terms refer to the degree of ownership that a parent company holds in another company. In most cases, the terms affiliate and associate are used synonymously to describe a company whose parent only possesses a minority stake in the ownership of the company. A subsidiary, on the other hand, is a company whose parent is a majority shareholder. Consequently, in a wholly owned subsidiary the parent company owns 100% of the subsidiary. For example, the Walt Disney Corporation owns about a 40% stake in the History Channel, an 80% stake in ESPN and a 100% interest in the Disney Channel. In this case, the History Channel is an affiliate company, ESPN is a subsidiary and the Disney Channel is a wholly owned subsidiary company.