Home › CA Final › financialreporting › Ind AS 111 — Joint Arrangements: Joint Control, Implicit/Explicit Joint Control, Protective Rights › DEF Ltd. is established by D, E and F. Unanimous…
DEF Ltd. is established by D, E and F. Unanimous consent of all three is required ONLY for change of name, amendment to constitutional documents, change of registered office. Other relevant-activity decisions need only D and E to agree. Identify the parties with joint control.
ANone — the protective-rights structure prevents any joint control
BD, E and F all have joint control
CF only, because F's consent is required for fundamental matters
DD and E only — F's unanimous-consent rights are protective rights and do not give F joint control
Answer & Solution
Correct answer: D. D and E only — F's unanimous-consent rights are protective rights and do not give F joint control
Protective rights protect a party's interest in fundamental changes (winding up, amending constitution, etc.) but do NOT give power over the relevant activities. F has only protective rights. Joint control is between D and E whose unanimous consent is required for decisions about relevant activities.
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