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Sir for this question under associate can I add this as follows:
Can I state like the associate might be wrongly classified as associate as Stewart co. might not have significant influence. Thus It should be a investment which will need to be write off as expenses hence there is a risk that the NCA and profit are overstated.
Thanks.
Whether or not it’s an associate does not preclude the possibility that the value of the investment needs to be impaired
If it is, or is not, an associate (or an investment) it still needs to be considered for impairment
Just to clarify both associate or investment appears on the consolidated statement of financial position?
Sir
If parent company cannot demonstrated the ability to exercise significant influence, then the investments should be treated as trade investment and would not be consolidated in the SFP ?
Pls correct me thank u 🙂
There’s nothing to correct … except possibly …
Those investments will still appear in the consolidated statement of financial position but you’re correct in that they will not be consolidated as an associate
Instead the investments will appear as a single line item (at cost less any impairments) and the income stream from dividends received will be in the statement of profit or loss
OK?
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