The Partition Effect in Relation to a Group of Companies

The partition effect in relation to a group of companies arose when:

A) It was not permitted under The Corporations Law to consolidate an entity that was not a company. This resulted not only in the non-company entity not being consolidated, but also all the entities (company or otherwise) that it controlled not being consolidated.
B) The non-controlling shareholders in a number of companies controlled by a parent entity organised themselves to block the transfer of funds within a group.
C) Companies in a group coordinated to transfer assets in such a way as to protect part of the group from being taxed, thus reducing the total tax owing for the group as a whole.
D) Dividends were declared and paid in such a way as to manage cash reserves within a group.