Video: Equity Investments - Level of Influence

In this lesson, Nick Palazzolo, CPA, breaks down how to account for equity investments based on the level of influence an investor has over the investee. He walks through the different ownership percentages, explaining that owning 0-20% usually signifies little to no significant influence, while 20-50% ownership—if significant influence is present—triggers the use of the equity method. Nick sets the stage for diving into consolidation and acquisition methods in upcoming discussions, but keeps the focus squarely on understanding how these ownership thresholds impact investment accounting, with a nod to continuity from prior fair value-related concepts.