Question : SFRS(I) 10 requires an investor to consolidate an investee based on whether it has control. Critically analyse the above case and provide your views on the accounting treatment for this investment in note in the financial statements of L Ltd for the financial year ended 31 December 2020 under SFRS(I) 10. (No marks will be given if you simply quote the standard without any attempt to apply the principles.) (15 marks)

Please help me out on this, thankkkk you so much :) ( 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