There’s a line in here that says,"… an investor holding 25 percent of an associate may be unable to exert significant influence and may be unable to access cash flows…" What does it mean by cash flows?
Basiclly, i think it means, use Equity Method. ‘Significant Influence’ meaning to use Equity Method and ‘unable to access cash flows’ meaning they dont have ‘control’, so dont use Acquisition Method. If you could use cash flows in that company the way you wanted to spend them, that would mean you have ‘control’ and would mean using Acquisition Method.
ok, I think I understand what it means. They could have worded it better though, no? Or it’s just late… Thanks