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Under Ind AS 110, a DEEMED SEPARATE ENTITY ("SILO") is treated as a separate investee for control assessment if:
AThe silo is operated by a separately incorporated subsidiary
BThe silo crosses a 5% threshold of total group assets
CSpecified assets of the investee are the only source of payment for specified liabilities of the investee — i.e., other parties have no rights to those assets or their proceeds
DEach silo has separate management and accounting books
Answer & Solution
Correct answer: C. Specified assets of the investee are the only source of payment for specified liabilities of the investee — i.e., other parties have no rights to those assets or their proceeds
Para B76-B77 — a silo arises when a PORTION of an investee operates as a deemed separate entity: specified assets are the only source for specified liabilities, and other parties have no claim on those assets or their proceeds (and vice versa). Each silo is then assessed for control INDEPENDENTLY. Separate legal-entity status, asset-size thresholds, and management structure are NOT the test.
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