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Smith Inc. is a privately held company with an April 30th year end. In May, 2020 Smith acquired a controlling interest in Tierney Corporation and is now the parent company. Tierney Corporation's fiscal year end is March 31. The staff accountant for Smith is in the process of preparing the consolidated financial statements for Smith Inc. as of April 30, 2021. The staff accountant is unsure if Smith, Inc. can use Tierney's March 31, 2021 financial statements in the consolidation. The staff accountant is concerned that Tierney needs to change their fiscal year to April 30and update their financial statements for consolidation.
Problem 1: Is Tierney required to change their fiscal year end to April 30th in order for Smith, Inc. to correctly prepare the consolidated financial statements?
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