CERTYNEX IFRS ACADEMY

Sextant SA manages the Zénith fund. One investor, Orme SA, can remove Sextant at any time, without having to give a reason and without the agreement of any other party. Case assumption: this right is substantive. What is the effect of this right in the principal / agent analysis of Sextant?

It has no effect on the analysis: Sextant's decision-making power over the relevant activities establishes that it is a principal.

It counts if a majority of investors must act together to remove Sextant, an individual right being set aside.

It can be enough to conclude that Sextant is an agent, since a single party can remove it without cause.

It presupposes that Sextant has committed a fault: a removal right exercisable without cause does not limit its decision-making power.