Company consolidating general interest investment partnership

limited partnership is presumed to control the partnership (unless a clause to the contrary is contained in the partnership agreement) and should consolidate the operations of the partnership into its BE-12 report. affiliate, is the sole general partner of Company LP, a U. The 99 percent financial interest in the equity of LP held by the limited partner should be included on GP's Form BE-12A in item 77 (Owners’ equity - other).

GP controls LP and should consolidate LP into its BE-12 report.

LP will sell limited partnership interests through private placements to unaffiliated investors seeking the money management services of Investment Advisor.

Investments in entities which the Company does not consolidate but for which the Company has the ability to exercise significant influence over operating and financial policies are reported under the equity method of accounting.

An unincorporated organization with two or more members is generally classified as a partnership for federal tax purposes if its members carry on a trade, business, financial operation, or venture and divide its profits.

The issue concludes as to what rights held by the limited partner(s) preclude consolidation in circumstances in which the sole general partner would otherwise consolidate the limited partnership in accordance with GAAP.

The assessment of limited partners’ rights and their impact on the presumption of control of the limited partnership by the sole general partner should be made when an investor becomes the sole general partner and should be reassessed if (i) there is a change to the terms or in the exercisability of the rights of the limited partners, (ii) the sole general partner increases or decreases its ownership of limited partnership interests, or (iii) there is an increase or decrease in the number of outstanding limited partnership interests.

Unlike a partnership, none of the members of an LLC are personally liable for its debts.

An LLC may be classified for federal income tax purposes as either a partnership, a corporation, or an entity disregarded as an entity separate from its owner by applying the rules in Regulations section 301.7701-3.

The Office of General Counsel issued the following opinion on December 12, 2007 representing the position of the New York State Insurance Department.

Would the limited partnership described below be regarded as an investment subsidiary under the New York Insurance Law?

affiliates that are limited partnerships or that have an ownership interest in a U. If your situation is not addressed, please contact us at A U. In addition, LP should be listed on the Supplement A of GP's Form BE-12A.

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