Equity Method in Separate Financial Statements (Amend IAS 27)
The Accounting Standards Board (AcSB) is participating in the International Accounting Standards Board’s (IASB) project to amend International Accounting Standard (IAS) 27 Separate Financial Statements relating to the use of the equity method.
The objective of the project is to allow entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in their separate financial statements. The proposed guidance is expected to reduce compliance costs for many entities, while providing information helpful to an assessment of the investor’s net assets and profit or loss.
The AcSB is participating in the activities of the project to ensure that Canadian entities’ financial reporting needs are considered by the IASB. The amendments will be incorporated into Canadian GAAP in accordance with the AcSB’s strategy of adopting International Financial Reporting Standards (IFRSs) for publicly accountable enterprises.
Final Amendments – Equity Method in Separate Financial Statements
August 21, 2014. The IASB has issued narrow-scope amendments to IAS 27 Separate Financial Statements to allow entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in their separate financial statements. The amendments are effective for annual periods beginning on or after January 1, 2016 with earlier application permitted.
AcSB Response – Equity Method in Separate Financial Statements
On February 4, 2014, the AcSB submitted a comment letter responding to the IASB’s Exposure Draft issued in December 2013. The letter supports the proposal to permit the equity method as one of the options to account for an entity’s investment in subsidiaries, joint ventures and associates in the entity’s separate financial statements. However, the letter requests that the consequential amendment to IAS 28 be redrafted to reflect more clearly the accounting the IASB intended when an entity loses control of a subsidiary and the investment continues to be classified as either an associate or a joint venture. Read the AcSB letter posted by the IASB.
AcSB Exposure Draft – Equity Method in Separate Financial Statements
December 23, 2013. The AcSB has issued an Exposure Draft that corresponds to the IASB’s Exposure Draft on this topic. Canadian stakeholders are encouraged to submit their comments, on the form provided, by February 3, 2014.
IASB Exposure Draft – Equity Method in Separate Financial Statements (Proposed amendments to IAS 27)
December 9, 2013. The IASB has issued an Exposure Draft proposing amendments to IAS 27 Separate Financial Statements. Canadian stakeholders are encouraged to submit their comments to the IASB by February 3, 2014.
Disclaimer: This project summary has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on this project, which may change after further Board deliberations. Decisions to publish Handbook material are final only after a formal ballot process.