Rahim, Fathimah, Rachel, Ching, Saraswathi and Kumar are newly recruited Audit Assistants in one of the prestigious audit firm in Kedah. The Audit Partner Mr Karim assigns a case in order to assess their critical thinking and problem solving skills. One of their main client plans to undergo expansion of its dairy manufacturing capabilities in Johor through a joint arrangements with other leading corporate company in the same sector. In accordance with MFRS 11 Joint Arrangements, a joint arrangement is an arrangement of which two or more parties have joint control. The client prefers to go under joint arrangement as the both parties could share costs and risks for the dairy manufacturing expansion with access to new technology. However, the client is having doubt whether joint venture would be the ideal choice in the joint arrangement between both parties. The client had referred to the audit firm for the business advisory services. Thus, Mr Karim requires the six audit assistants to write a report based on their critical findings whether joint venture will be suitable for the manufacturing capabilities expansion. The guide for the team is as follows:

(a) make decision whether the joint venture is the ideal choice in the joint arrangement between both parties. (15marks)