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CIMAPRA19-F01-1 Exam - Topic 2 Question 32 Discussion

Which of the following would be classified as a parent and subsidiary relationship in accordance with IFRS 10 Consolidated Financial Statements?
A) Entity A owns 30% of another entity's equity shares and has the power to appoint or remove the majority of the members of the board of directors and control of the entity is through that board.
B) Entity B owns 20% of another entity's equity shares and has an agreement with other equity shareholders of that entity that gives it power over a further 20% of the equity voting rights.
C) Entity C owns 45% of another entity's equity shares and can exercise significant influence over that entity's financial and operating policy decisions.
D) Entity D owns 25% of another entity's equity shares and associated voting rights and 100% of its preference shares.

CIMAPRA19-F01-1 Exam - Topic 2 Question 32 Discussion

Actual exam question for CIMA's CIMAPRA19-F01-1 exam
Question #: 32
Topic #: 2
[All CIMAPRA19-F01-1 Questions]

Which of the following would be classified as a parent and subsidiary relationship in accordance with IFRS 10 Consolidated Financial Statements?

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Suggested Answer: A

by Felicidad at May 05, 2022, 08:26 PM

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Shannan
9 months ago
D sounds off, owning 25% doesn’t seem strong enough for control.
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Alyssa
9 months ago
C is more about significant influence, not control.
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Belen
9 months ago
Wait, can you really control with just 30%?
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Maile
9 months ago
I disagree, B could also fit if you consider the agreement.
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Deonna
9 months ago
A seems like a clear parent-subsidiary case.
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Han
10 months ago
Ah, I've got it! The purpose of internal audits is to help employees do their jobs better. It's all about improving operations and processes, not just getting ready for the external auditors.
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Erasmo
10 months ago
Okay, I've got this. Field names are case sensitive, but field values are not. So the correct answer is A. True.
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Dacia
10 months ago
This seems like a straightforward question. I think the answer is probably in the Customizations section of the System Settings.
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