Under paragraph B23 of AASB 10/IFRS 10 Consolidated Financial Statements, factors to consider in assessing whether the rights over an investee are substantive include:
A) whether there are any barriers that prevent the investor from exercising them.
B) where more than one party is involved, whether there is a mechanism in place to enable those parties to practically exercise them.
C) whether the party or parties that hold the rights would benefit from the exercise of those rights.
D) all of the options are correct.

Question

Quizplus · Accepted Answer

All of the options listed are factors to consider in assessing whether the rights over an investee are substantive. Restrictions or barriers that prevent the investor from exercising their rights, mechanisms in place for multiple parties to exercise their rights, and the benefit that would be gained from such exercises are all important considerations in determining the nature and extent of an investor's influence over an investee.

Under Paragraph B23 of AASB 10/IFRS 10 Consolidated Financial Statements