Question

GASB provides guidance for determining when a primary government should include a legally separate organization in its financial report as a component unit. Which of the following statements would not require inclusion? Multiple Choice Ha govemment has controlling interest in a commercial business in which it exercises operational control. The primary govemment controls a voting majority of the other organization's governing board or otherwise may impose its will on the organization and the releted organization is fiscally dependent on the primary government fa govermment has controling interest in a commercial business solely es an investment to earn income The seperate organization is fiscelly dependent on the primary government and the related organizetion is fiscolly dependent on the primary government

Answer 1

Answer is option C

C. If a government has controlling interest in a commercial business solely as an investment to earn income.

GASB includes organization in which the primary government holds majority of voting rights, organization that is fiscally dependent on primary government and organization in which the primary government exercises operational control.