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Common control is described as 'not transitory' in Appendix C. Which of the following is INCORRECT?
AWhere two or more individuals control combining entities under a contractual agreement, the assessment must verify whether their collective control is itself non-transitory
BCarrying out a combination in contemplation of an IPO automatically renders the prior common control 'transitory'
CPartial NCI in either combining entity does not break the 'common control' status
DIf common control exists only briefly before and after the combination to bridge a substantive change in control, the combination is NOT a common control combination — Ind AS 103 mainline applies
Answer & Solution
Correct answer: B. Carrying out a combination in contemplation of an IPO automatically renders the prior common control 'transitory'
Carrying out a combination in contemplation of an IPO or sale of the combined entities does NOT, on its own, make common control 'transitory' — common control assessment is about whether the control existed and was substantive before/after, not about subsequent listing intent. The other statements correctly summarise Ind AS 103 Appendix C guidance.
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