Final answer:
The primary differences in consolidation procedures between the initial value and partial equity methods are in the treatment of investment account adjustments and the recognition of undistributed profits or losses from the investee.
Step-by-step explanation:
When addressing the consolidation procedures under the initial value or the partial equity method, the key distinction lies in the treatment of investment and equity earnings. While the initial value method recognizes the investment at its original cost without subsequent adjustments for the investee's net income or dividends (except for impairment), the partial equity method adjusts the investment account for the investor's share of the investee's earnings less dividends received.
Thus, under the initial value method, consolidation procedures do not require adjustments for undistributed profits or losses that are recognized in the partial equity method. Additionally, the treatment of subsidiary's equity changes only through the recording of dividends in the initial value method, whereas the partial equity method recognizes share of subsidiary's earnings. It is essential to remember that the selection of either method can be made based on the relevance and materiality of the investment to the investor's financials, and they should provide a guideline rather than an absolute determination of financial treatment.