Page 14 - Topic 1 - 1. Consolidated & Separate Financial Statement

CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
Power over Investee: IFRS 10.10 - .14

• Consider only substantive rights (B22)

• Holder must have practical ability to exercise

• Consider factors in B23

• Rights must be currently exercisable (B24)

• Even if not yet exercised

• Ignore protective rights

• Protect interests without granting power

• Relate to fundamental changes or apply in exceptional

circumstances (B26)

• Examples (B28):

• Lender’s right to restrict borrower from activities which
significantly change credit risk
• Non Controlling Interest’s right to approve capital expenditure

• Lender’s right to seize assets if borrower fails to make repayments

• May have power even if others have ability to

participate

• E.g. significant influence

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