Finance:Parent company guarantee
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A parent company guarantee (PCG) is a guarantee by a parent company of a contractor’s performance under its contract with its client, where the contractor is a subsidiary of the parent company.
It is mandatory for all the companies to mention about the guarantees granted as a note in their accounts because it is a risk for the company. The parent/holding company can refuse to renew the guarantee.
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Original source: https://en.wikipedia.org/wiki/Parent company guarantee.
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