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Basic group structures – Introduction – ACCA Strategic Business Reporting (SBR) lectures

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  5. Hi, My doubt is that as in the Vader example, there is representation in the board and here it is clearly written, 2 directors out of 8, so did we consider 25% also in this (2/8*100), and as 25% is more than 20% so significant influence here is from that reason? Is what am i thinking is Right?

    • You need also to compare the conditions of ‘control’ and conditions of ‘significant influence (bottom of page 11 and top of page 12) to avoid confuse between of them. Because ‘control’ is also ‘significant influence’ but ‘significant influence’ is not always ‘control’. Thanks

    • You are right for “significant influence”, however the ‘25% calculation’ was not the correct reason. See, if Vader only took 1 out of 8 directors, would you still consider it was “significant influence”? On your method, no, because 1/8=12.5%, less than 20%. However, check the notes in Page 12, “presentation on board”, Vader has the power, even if it can only takes 1, it would also be consider to have “significant influence” over Ren.

  7. I am giving SBR as the first paper as i received exemptions. Is it better to stick to the order you have uploaded lectures of SBR as group accounts is at the end of FR but here at SBR it is in start? Dont i need to go through standards first before this???

  8. I am giving SBR as the first paper as i received exemptions. Is it better to stick to the order you have uploaded lectures of SBR as group accounts is at the end of FR but here at SBR it is in start? Dont i need to go through standards first before this?

  9. I have doubt in associate part. you talked about very less or little bit than 20%. what if investor has representation on the board 3/8, but has only 10% shares?
    thanks for such a clear and clarity explanation in video.

    • As the company only owns 10% shares therefore it can be presumed that the company has no significant influence of the investee. However it can be demonstrated otherwise which the company has represent the board of directors with 3/8 seats on the board. Therefore, the company has significant influence and the investee is an associate.

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