A Study On The Judgment Of "Three Elements Of 'Control" In The Merging Of Structured Subjects

The “Enron Incident” in 2001 and the subprime mortgage crisis in 2008 fully exposed the huge risks of asset securitization and innovative financial instruments.Since then,investors and the government have increased their attention,and countries have begun to develop structured entities.And other relevant guidelines to prevent risks and regulate market behavior.As far as China's current situation is concerned,the capital market is still developing,the structured entities and related financial activities appear later,and the form is relatively simple.The risks contained therein are not fully exposed.However,due to the good development of the capital market,the relevant standards and Laws and regulations are imperative.Under the dual influence of the convergence of accounting standards and the status quo of China,China introduced the definition of “control” in the new enterprise merger guidelines in 2014,that is,“power”,“variable return”,“whether power has the ability to influence variable “Return” to clarify the criteria for substantive control,and to clarify the scope of the business combination and to include in the consolidated statement.Based on the "three elements of 'control'" in the merger,this paper further discusses how to standardize the scope of consolidation of structured entities in light of the problems in the process of consolidated statements.This paper first sorts out the origins of structured subjects and their similarities and differences in Chinese,American and international accounting standards.Secondly,the judgment of structured subjects is based on the "three elements of'control'",and the "three elements of 'control'" are sorted out.The connotation,characteristics and implementation forms of substantive control,so as to summarize the criteria for determining the 'three elements of 'control',and taking the merger of HTSL funds as an example,analyzing the voting rights and assigning rights of HTSL funds related activities from the Partnership Agreement,decision-making and investment entity participation and commitment to judge the ownership of power,from the HTSL fund's main income level analysis,risk-return distribution analysis whether it is a variable return,and finally from the operation of the relevant activities that have a significant impact on the decision-making analysis and decision-making Behavior and related risk reward assessments determine whether power affects variable returns.Through the specific analysis of the case,the following conclusions are drawn: When judging whether to include the HTSL fund in the consolidated statement,the substantive control standard on which the HTSL fund is based is neglected the power enjoyed in the initiation stage,and the emphasis on the form of power is ignored.The main responsible person and The agent's judgment criteria are not strict and ignore the impact of providing temporary liquidity support.And put forward corresponding suggestions for the conclusions obtained,in order to enhance the operability and extensiveness of the substantive control standards.