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Primary beneficiary is an enterprise designed to absorb the majority of losses and/or returns of a variable interest entity. If the entity receives the returns and then another entity absorbs the lost, therefore, the entity who absorbs most of the loss is the primary beneficiary. Quick note, determining whether a VIE is to be consolidated is contingent on the share of profits and/or the obligation to absorb losses.
1 Comment
4/15/2020 02:34:29 am
Honestly, I was still really clueless about the main function of Primary beneficiary before. But since you already have it explained here, I want to thank you because I know that you have worked so hard just to give an explanation to your readers about this matter. Since a lot of people have been asking for it, you have finally provided something good, that’s why others must be really thankful to you, and myself included there! Leave a Reply. |
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