Which entities, if any, would form part of the Traffic Management Holdings Ltd Group? (Question)

Traffic Management Holdings Ltd (TMHL), a public company, commenced trading in 2001. TMHL has investments in a number of partly and wholly owned subsidiaries and a diverse shareholder group including original owners, self-managed superannuation funds, and other sophisticated investors.TMHL Group achieved turnover of $100 million last financial year (FY19 ended 30 June 2019), has gross assets of $62m and employs over 1,000 employees across Australia and New Zealand.Debt within the company is provided by way of debentures issued to the public and also through one of the major four Australian banks. During the course of this financial year, FY20 ending 30 June 2020, the company has pursued a strategic growth strategy undertaking a number of investments. The Directors of TMHL have decided to change audit firms and have approached your audit and advisory firm to undertake the audit and to seek initial advice on how to account for the investments they have made during the FY20 financial year. All shares and units issued by each of the entities are ordinary shares or units with normal voting rights. All key facts as known to the company in relation to the investments made are provided on the following page

Canberra Ltd

TMHL Ltd owns 45% of the issued capital.

The remaining shares are owned by a diverse group of investors who each hold a small parcel of shares, many of whom are unlikely to attend meetings.

The current board of directors of Canberra Ltd has seven members.

Six directors on the board of Canberra Ltd are appointed by TMHL Ltd.

Sydney Ltd

TMHL Ltd owns 90% of the issued capital.

The remaining shares are owned equally between two shareholders.

Adelaide Ltd

TMHL Ltd owns 35% of the issued capital.

Sydney Ltd owns 25% of the issued capital.

The remaining shares are owned by a small group of investors who each own 10% of the issued shares.

TMHL Ltd and Sydney Ltd each have two appointees on the board of directors which has five members.

Melbourne Ltd

TMHL Ltd owns 40% of the issued capital.

Three institutional investors equally hold 50% of the issued capital. These shareholders regularly attend meetings and vote.

The remaining 10% of the issued capital are owned by a geographically diverse group of investors who each hold a small parcel of shares, many of whom are unlikely to attend meetings.

Perth Ltd

TMHL Ltd owns 25% of the issued capital.

The remaining shares are owned by three institutional investors who each own 25% of the issued capital.

All investors have rights to the net assets of Perth Ltd. They take a keen interest in the running of the company and attend all meetings.

The shareholders of Perth Ltd have a contractual agreement whereby each investor cannot make any operating, investing or financing decisions without the expressed consent of the other parties.