Investments are reported at fair value when a company has an insignificant influence over another company in which it invests.

Question

Quizplus · Accepted Answer

This statement is true. According to accounting standards, investments in which a company has an insignificant influence over the investee should be reported at fair value. This is often the case with investments in publicly-traded securities, where the company may own a small percentage of the investee's shares and have no control over its operations.

Investments Are Reported at Fair Value When a Company Has