The Shareholders of a Public Corporation Do Not Participate Directly

question 24

True/False

The shareholders of a public corporation do not participate directly in the day-to-day operation of a company but appoint the executive management group to do so at the shareholders' general meeting.

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Definitions:

Significant Influence

The power to participate in the financial and operating policy decisions of an investee without having control over those policies.

Equity Method

An accounting technique used to record an investment, where the investor recognizes income equal to its share of the investee's profit.

Securities

Financial instruments representing ownership (stocks), a debt agreement (bonds), or the rights to ownership (derivatives).

Fair Value

An estimated market value of an asset or liability, reflecting current market conditions rather than historical cost, used in financial reporting.