AASB 127 defines control as:
A)the power to participate in the financial and operating policies of an entity so as to obtain benefits from its activities
B)the power to govern financial and operating policies of an entity so as to obtain benefits from its activities
C)the power to govern the financial but not the operating policies of an entity so as to obtain benefits from its activities
D)the power to have significant influence over the financial and operating policies of an entity so as to obtain benefits from its activities

Question

Quizplus · Accepted Answer

AASB 127 defines control as "the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities". Option A includes the word "participate" which does not imply control. Option C refers only to financial policies and not operating policies, which is not the complete definition of control. Option D refers to significant influence, which is a different concept from control. Therefore, option B is the best choice as it accurately reflects the definition of control given in AASB 127.

AASB 127 Defines Control As