In a joint venture under FRS 102, what is necessary for joint control to exist?

For joint control to exist in a joint venture under FRS 102, unanimous consent for strategic decisions is necessary. This means that all parties involved in the joint venture must agree on key decisions that affect the venture's direction and operations. Such decisions could encompass significant aspects like budgeting, investments, and changes in company strategy.

This requirement for unanimous consent ensures that no single party can unilaterally make decisions that could potentially disadvantage the others, thereby reinforcing the collaborative nature of a joint venture. In contrast, majority ownership by one party could lead to scenarios where that party exerts excessive influence over decisions, undermining the principle of joint control. Similarly, while a formal business registration or defined profit-sharing agreements might be aspects of forming a joint venture, they do not inherently establish joint control; rather, it is the agreement on decision-making processes that is critical.