In a VIE, the majority of losses or income ﬂow to the primary beneﬁciaries, not the residual interest shareholders shareholder.The distribution of income is not based on common stock ownership.Instead, it is based on contractual agreements that could include interest on loans, management fees or a deﬁned percentage of revenue or income.

Question

Quizplus · Accepted Answer

As stated in the sentence, the majority of losses or income flow to the primary beneficiaries and not the residual interest shareholders, and the distribution of income is based on contractual agreements rather than common stock ownership.

In a VIE, the Majority of Losses or Income ﬂOw