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IAS 28 |
Investments in Associates and Joint |
Ventures |
In April 2001 the International Accounting Standards Board (Board) adopted IAS 28 |
Accounting for Investments in Associates , which had originally been issued by the |
International Accounting Standards Committee in April 1989. IAS 28 Accounting for |
Investments in Associates replaced those parts of IAS 3 Consolidated Financial Statements (issued |
in June 1976) that dealt with accounting for investment in associates. |
In December 2003 the Board issued a revised IAS 28 with a new title— Investments in |
Associates . This revised IAS 28 was part of the Board’s initial agenda of technical projects |
and also incorporated the guidance contained in three related Interpretations |
(SIC-3 Elimination of Unrealised Profits and Losses on Transactions with Associates , SIC-20 Equity |
Accounting Method—Recognition of Losses and SIC-33 Consolidation and Equity Method—Potential |
Voting Rights and Allocation of Ownership Interests ). |
In May 2011 the Board issued a revised IAS 28 with a new title— Investments in Associates |
and Joint Ventures. |
In September 2014 IAS 28 was amended by Sale or Contribution of Assets between an Investor |
and its Associate or Joint Venture (Amendments to IFRS 10 and IAS 28). These amendments |
addressed the conflicting accounting requirements for the sale or contribution of assets |
to a joint venture or associate. In December 2015 the mandatory effective date of this |
amendment was indefinitely deferred by Effective Date of Amendments to IFRS 10 and IAS 28 . |
In December 2014 IAS 28 was amended by Investment Entities: Applying the Consolidation |
Exception (Amendments to IFRS 10, IFRS 12 and IAS 28). These amendments provided |
relief whereby a non-investment entity investor can, when applying the equity method, |
choose to retain the fair value through profit or loss measurement applied by its |
investment entity associates and joint ventures to their subsidiaries. |
In October 2017, IAS 28 was amended by Long-term Interests in Associates and Joint |
Ventures (Amendments to IAS 28). These amendments clarify that entities apply |
IFRS 9 Financial Instruments to long-term interests in an associate or joint venture to which |
the equity method is not applied. |
Other Standards have made minor consequential amendments to IAS 28. They include |
IFRS 9 Financial Instruments (issued July 2014), Equity Method in Separate Financial |
Statements (Amendments to IAS 27) (issued August 2014), Annual Improvements to |
IFRS® Standards 2014–2016 Cycle (issued December 2016), IFRS 17 Insurance Contracts (issued |
May 2017) and Amendments to References to the Conceptual Framework in IFRS Standards (issued |
March 2018).IAS 28 |
© IFRS Foundation A1303 |
CONTENTS |
from paragraph |
INTERNATIONAL ACCOUNTING STANDARD 28 |
INVESTMENTS IN ASSOCIATES AND JOINT VENTURES |
OBJECTIVE 1 |
SCOPE 2 |
DEFINITIONS 3 |
SIGNIFICANT INFLUENCE 5 |
EQUITY METHOD 10 |
APPLICATION OF THE EQUITY METHOD 16 |
Exemptions from applying the equity method 17 |
Classification as held for sale 20 |
Discontinuing the use of the equity method 22 |
Changes in ownership interest 25 |
Equity method procedures 26 |
Impairment losses 40 |
SEPARATE FINANCIAL STATEMENTS 44 |
EFFECTIVE DATE AND TRANSITION 45 |
References to IFRS 9 46 |
WITHDRAWAL OF IAS 28 (2003) 47 |
APPROVAL BY THE BOARD OF IAS 28 ISSUED IN DECEMBER 2003 |
APPROVAL BY THE BOARD OF AMENDMENTS TO IAS 28: |
Sale or Contribution of Assets between an Investor and its Associate or |
Joint Venture (Amendments to IFRS 10 and IAS 28) issued in September |
2014 |
Investment Entities: Applying the Consolidation Exception (Amendments to |
IFRS 10, IFRS 12 and IAS 28) issued in December 2014 |
Effective Date of Amendments to IFRS 10 and IAS 28 issued in |
December 2015 |
Long-term Interests in Associates and Joint Ventures (Amendments to |
IAS 28) issued in October 2017 |
FOR THE ACCOMPANYING GUIDANCE LISTED BELOW, SEE PART B OF THIS EDITION |
TABLE OF CONCORDANCE |
FOR THE BASIS FOR CONCLUSIONS, SEE PART C OF THIS EDITION |
BASIS FOR CONCLUSIONS |
DISSENTING OPINIONSIAS 28 |
A1304 © IFRS Foundation |
International Accounting Standard 28 Investments in Associates and Joint Ventures (IAS 28) |
is set out in paragraphs 1 –47. All the paragraphs have equal authority but retain the |
IASC format of the Standard when it was adopted by the IASB. IAS 28 should be read in |
the context of its objective and the Basis for Conclusions, the Preface to IFRS |
Standards and the Conceptual Framework for Financial Reporting . IAS 8 Accounting Policies, |
Changes in Accounting Estimates and Errors provides a basis for selecting and applying |
accounting policies in the absence of explicit guidance.IAS 28 |
© IFRS Foundation A1305 |
International Accounting Standard 28 |
Investments in Associates and Joint Ventures |
Objective |
The objective of this Standard is to prescribe the accounting for |
investments in associates and to set out the requirements for the |
application of the equity method when accounting for investments in |
associates and joint ventures. |
Scope |
This Standard shall be applied by all entities that are investors with joint |
control of, or significant influence over, an investee. |
Definitions |
The following terms are used in this Standard with the meanings specified: |
An associate is an entity over which the investor has significant influence . |
Consolidated financial statements are the financial statements of a group in |
which assets, liabilities, equity, income, expenses and cash flows of |
the parent and its subsidiaries are presented as those of a single economic |
entity. |
The equity method is a method of accounting whereby the investment is |
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