Q1, It depends on if the subsidiary is independently managed or not . If it holds out to its own clients that it is independent and managed substantially by its own managers using their own strategies with full discretionary control , has independent marketing capability , then it is really a seperate firm by GIPS definition and can define its own firm boundaries. Sounds a bit far fetched though.
Q2. This is more tricky , probably also far fetched. If the subsidiary does not follow GIPS , then ABC cannot consolidate the results from the subsidiaries portfolios into its composites. The firm cannot include the subsidiary into its boundary definition , has to exclude the assets of the subsidiary , and generally treat them as a pariah for everything GIPS. sounds quite far-etched.