Under IAS 27, how is "control" defined?
A)Ownership of 50% of more of the voting shares of another entity
B)Representation on another entity's board of directors
C)The power to govern financial and operating policies of an entity so as to obtain the benefits from its activities
D)Ownership of 30% or more of the voting shares of another entity

Question

Quizplus · Accepted Answer

"Control" is defined as the power to govern financial and operating policies of an entity so as to obtain the benefits from its activities. This power may be acquired through ownership of voting shares or other means. Ownership of 50% or more of the voting shares is not necessary to establish control. Additionally, representation on another entity's board of directors does not necessarily indicate control. Therefore, option A and B are incorrect. Option D is also incorrect as ownership of 30% or more of voting shares does not necessarily establish control.

Under IAS 27, How Is "Control" Defined