Podcast: Significant influence, by analogy

Podcast overview

To explain significant influence, we naturally thought of one of life's biggest investments - kids!  

One thing is clear – parents do not have control. But they are much more than passive investors, meaning they have 'significant influence' over their kids. 

This makes sense if you think about it. Kids depend on their parents to teach them things, to navigate the streaming services to find their favorite shows, and of course money. That dependency gives parents the ability to influence their children to do things like chores, homework, or to eat their dinner. But, as kids grow older, parents’ level of influence tends to fade.  

The same thing is true for equity method investments. On this episode, we explain how the qualitative indicators of significant influence in ASC 323 are just like common parenting hacks.

Podcast contents

• 00:01 – Introduction
• 04:05 – Why is the equity method called a ‘one line consolidation’?
• 05:35 – The rebuttable presumption
• 07:45 – Qualitative indicators of significant influence
• 16:30 – How do you weigh all the indicators?
• 20:20 – What changes can cause you to lose significant influence?
• 22:22 – Closing