Asked by Sichen Zhang on May 17, 2024
Verified
If a company has control over the financial policies of another entity,it is deemed to have control over the operating policies.
Control
The ability to control the economic and functional strategies of an organization in order to gain advantages from its operations.
Financial Policies
Guidelines, rules, and procedures created by a company to govern its actions in the financial market, including investment, allocation, spending, and financing activities.
Operating Policies
Guidelines and protocols established by a company to govern its day-to-day operational activities and decisions.
- Acquire knowledge on the concept and repercussions of creating a group, including the mitigation or influence on legal accountability.
Verified Answer
CJ
Charles JamesMay 18, 2024
Final Answer :
False
Explanation :
Having control over the financial policies of another entity does not necessarily mean a company has control over the operating policies. Control over financial policies might relate to financial decisions, investments, and funding, while control over operating policies involves decisions on the entity's day-to-day operations, strategies, and management practices. These are distinct areas of governance.
Learning Objectives
- Acquire knowledge on the concept and repercussions of creating a group, including the mitigation or influence on legal accountability.