Question : Explain the possible theoretical and practical issues/challenges in applying SFRS(I) 10 and SFRS(I) 3 Business Combination to the above investment. (15 marks)

Please help me out on this, thank you so much, appreciated! :) ( 1 to 1.5 pages )

Background A listed company, L Ltd invested $200 million in the form of 5-year notes issued by a private company, A Pte Ltd during the financial year ended 31 December 2020. A Pte Ltd was wholly- owned by its founder, Mr. F, who injected $1 as share capital. In addition to the notes, L Ltd was granted 200 million warrants convertible into 200 million new shares in A Pte Ltd at $1 per share. The warrants were exercisable at any time during the 5-year notes period. The exercise price of the warrants could be offset against the notes to avoid further cash outlay. The proceeds from the note issue were used by A Pte Ltd for investment in a property development, which is expected to be completed just before the notes are maturing. To protect its investments and returns, L Ltd also procured the following rights relevant to directing the activities of A Pte Ltd and the underlying property development through the investment contract: Approve the cessation of existing businesses; Approve any acquisition, disposal or dilution of any interests in businesses; Approve any alteration in capital structure; Approve borrowing, lending or guaranteeing above certain low thresholds; Appoint or request for a change of directors and other senior management personnel; and Restrict the dividend paid by A Pte Ltd to Mr. F; unless the same rate was paid to L Ltd as interest on the notes. L Ltd had board representation in A Pte Ltd. The Executive Director and Chief financial Officer of L Ltd took active roles in the management of A Pte Ltd. In addition, the General Manager and Chief Financial Officer of A Pte Ltd also reported to L Ltd's Executive Director and Chief Financial Officer. Background A listed company, L Ltd invested $200 million in the form of 5-year notes issued by a private company, A Pte Ltd during the financial year ended 31 December 2020. A Pte Ltd was wholly- owned by its founder, Mr. F, who injected $1 as share capital. In addition to the notes, L Ltd was granted 200 million warrants convertible into 200 million new shares in A Pte Ltd at $1 per share. The warrants were exercisable at any time during the 5-year notes period. The exercise price of the warrants could be offset against the notes to avoid further cash outlay. The proceeds from the note issue were used by A Pte Ltd for investment in a property development, which is expected to be completed just before the notes are maturing. To protect its investments and returns, L Ltd also procured the following rights relevant to directing the activities of A Pte Ltd and the underlying property development through the investment contract: Approve the cessation of existing businesses; Approve any acquisition, disposal or dilution of any interests in businesses; Approve any alteration in capital structure; Approve borrowing, lending or guaranteeing above certain low thresholds; Appoint or request for a change of directors and other senior management personnel; and Restrict the dividend paid by A Pte Ltd to Mr. F; unless the same rate was paid to L Ltd as interest on the notes. L Ltd had board representation in A Pte Ltd. The Executive Director and Chief financial Officer of L Ltd took active roles in the management of A Pte Ltd. In addition, the General Manager and Chief Financial Officer of A Pte Ltd also reported to L Ltd's Executive Director and Chief Financial Officer