Which of the following statements is incorrect?
A) Significant influence requires the investor to have the power or capacity to participate in the investee's financial and operating policy decision.
B) The key criterion for identifying a joint arrangement is that the joint venturers have joint control over the joint venture.
C) Significant influence requires the investor to actually exercise its power over the investee.
D) The assessment of the existence of significant influence requires judgement on the part of the accountants.

Question

Quizplus · Accepted Answer

Significant influence does not necessarily require the investor to actually exercise its power over the investee, but only to have the capacity to do so. The other statements are correct.

Which of the Following Statements Is Incorrect