What is a group?
- FMV
- Apr 21, 2016
- 1 min read
A group is a business and all the other businesses under its control.Below in the picture, business A is the "parent" and has invested in businesses B, C and D by buying their equity: 100% in the case of B; 70% in the case of C; and only 25% of D. Companies B and C are different to D because they are controlled by A. Therefore A, B and C are part of the group. A business must own a majority of the equity in another business in order to gain control. Applying this logic to this example indicates that D is not controlled and is therefore not part of the group.
Note: The detailed rules on achieving control vary from country to country.
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