The Board considered the notion of "effective control" and guidance on how to assess the power to control when potentially conflicting notions of power occur simultaneously.

The staff recommended that the following be clarified:

• An entity with a current ability to determine strategic operating and financing policy only meets the power criterion in the absence of a third party able to dominate policy determination.
• An entity that does not dominate the determination of strategic operating and financing policy in practice but that has the ability to dominate such determination meets the power criterion. This is the case even if the entity has a history of not utilising its ability to dominate and/or has no intention of utilising this ability.

The staff noted that even if an entity is currently able to dominate policy determination, in some circumstances it may be difficult to determine whether that entity has power when potential voting rights can reduce its proportionate interest in the investee such that it would not have an enforceable right to power (sometimes referred to as 'legal control'). The staff recommended that a case-by-case assessment should be made, rather than concluding that an entity can never have power where taking into account potential voting rights, its proportionate interest in an investee is reduced and it will not have an enforceable right to power.

The Board agreed with the staff's recommendations but noted that care needs to be taken to assess the current situation and not whether the power to control will exist in the future.