Question 1 (25 marks) Scenario 1 In order to expand its business, a few years ago, Leeds Ltd purchased 43% of the ordinary shares of Salford Ltd. The remaining 57% shareholdings are held by three other shareholders who possess the equal proportions of shares. Required: (a) Explain the concept of de facto control. (2 marks) (40 to 50 words) (b) According to the above scenario, explain whether Leeds Ltd can control Salford Ltd (6marks)(50to60words) Scenario 2 Bristol Ltd holds 35% of the issued share capital of Swansea Ltd which is a retailer of furniture products. There is a contractual arrangement under which Bristol Ltd can control the purchase and sale of goods of Swansea Ltd such as determining the suitable kind of suppliers, the order quantity of the inventory, the selling price of the products and the sales quantity. This contractual arrangement can only be revoked in the special resolution of Swansea Ltd. Required: Explain whether Bristol Ltd can control Swansea Ltd. (6 marks) (50 to 60 words) Scenario 3 Tommy Ltd and Calvin Ltd are engaged in the same kind of business. Each of them has 50% of the voting rights in Park Ltd. The shareholder's agreement between Tommy Ltd and Calvin Ltd states the followings: 1) The purpose of Park Ltd is to purchase, manage and sell commercial buildings for generating capital gains. 2) All decisions such as the selection of commercial buildings, the style of their renovations and financing activities, require the mutual agreement of both Tommy Ltd and Calvin Ltd. 3) Tommy Ltd is responsible for the daily management activities of Park Ltd, such as finding tenants, negotiating rental agreements and rent collection. Calvin Ltd is NOT responsible for any management activities of Park Ltd. Required: In accordance with the IFRS 10, analyze the above situation in order to identify which party/parties may control Park Ltd. (11 marks) (170 to 200 words)