SEBI LODR defines ‘material subsidiary’ as one whose turnover or net worth exceeds ten percent of the consolidated turnover / net worth of the listed entity even as it states that the listed entity can formulate a policy for determining material subsidiary.
This may perhaps cause confusion.
The explanation should be construed to mean that listed entities can adopt a tighter or more conservation definition, i.e. that the aforementioned ‘ten percent’ threshold can be lower but not higher.
Affinisio(RPT) lets you maintain your own thresholds for this very reason so as to enable you to exercise the judgement required for such instances.
