If an Investor Entity Owns More Than Half of the Voting

question 22

Multiple Choice

If an investor entity owns more than half of the voting or potential voting power of an investee and does not account for the investment as a subsidiary,AASB 12 Disclosure of Interests in Other Parties,requires that the following disclosure be made:

• A)the reasons why the ownership of the investee does not constitute control
• B)the nature of the relationship between the investor and investee
• C)the significant judgements and assumptions it has made in determining the nature of the interest in the other entity
• D)the amount of any repayments of borrowings between the investor and investee during the period.

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Definitions:

Foreign Portfolio Investment

Investment in a country's securities, such as stocks and bonds, by non-resident investors, not aiming for control but rather intended for financial return.

Net Capital Outflow

The difference between the domestic purchase of foreign assets and the foreign purchase of domestic assets over a given period, reflecting the flow of capital from and into a country.

Barriers To Trade

Measures imposed by governments or policies that restrict or restrain international trade, through tariffs, quotas, or other regulations.

U.S. Exports

Goods and services produced in the United States and sold to other countries.