Under U.S.GAAP and IASB standards, the threshold for determining "significant influence" in an associate enterprise is:
A)50% ownership of voting shares.
B)5% ownership of voting shares.
C)20% ownership of voting shares.
D)10% ownership of voting shares.

Question

Quizplus · Accepted Answer

According to both U.S.GAAP and IASB standards, the threshold for determining "significant influence" in an associate enterprise is 20% ownership of voting shares. Therefore, choice C (20% ownership of voting shares) is the correct answer. Choice A (50% ownership of voting shares) represents controlling influence rather than significant influence, while choices B (5% ownership of voting shares) and D (10% ownership of voting shares) are too low to indicate significant influence.

Under USGAAP and IASB Standards, the Threshold for Determining "Significant Influence