Question 4 25 Marks The Finance Director has set up a company, River, through which Zoom conducts its investment activities. Zoomhas paid R400 million to River during the year and this has been included in dividends paid. The money was invested in a specified portfolio of investments. Ninety-five per cent of the profits and one hundred per cent of the losses in the specified portfolio of investments are transferred to Zoom. An investment manager has charge of the company's investments and owns all of the share capital of River. An agreement between the investment manager and zoom sets out the operating guidelines and prohibits the investment manager from obtaining access to the investments for the manager's benefit. An annual transfer of the profit/loss will occur on 30 June annually and the capital will be returned in four years' time. The transfer of R400 million cash occurred on 1 January 206 but no transfer of profit/loss has yet occurred. The statement of financial position of River on 30 June 206 is as Question 4 25 Marks The Finance Director has set up a company, River, through which Zoom conducts its investment activities. Zoomhas paid R400 million to River during the year and this has been included in dividends paid. The money was invested in a specified portfolio of investments. Ninety-five per cent of the profits and one hundred per cent of the losses in the specified portfolio of investments are transferred to Zoom. An investment manager has charge of the company's investments and owns all of the share capital of River. An agreement between the investment manager and zoom sets out the operating guidelines and prohibits the investment manager from obtaining access to the investments for the manager's benefit. An annual transfer of the profit/loss will occur on 30 June annually and the capital will be returned in four years' time. The transfer of R400 million cash occurred on 1 January 206 but no transfer of profit/loss has yet occurred. The statement of financial position of River on 30 June 206 is as