Equity Investments:
1. Passive = < 20%
2. Significant Influence = 20% to 50% (Associate)
3. Control = < 50% (Sole or Subsidiary)
4. Joint Control = Joint Arrangement
Characteristics of Joint Arrangement:
1. Contractual – written/oral.
2. Contractual Joint Control – required of unanimous consent on decisions for relevant activities.
Accounting for Joint Arrangement:
1. Joint Operations - without separate vehicle.
- with separate vehicle, parties have the right to assets and obligations to the
liabilities of the separate vehicle.
2. Joint Venture - with separate vehicle, parties have the rights to the net assets of the separate
vehicle.
- cannot recognize share in net loss if it will result in a negative balance in
investment; recognize only up to the extent of the investment balance.
Full PFRS:
1. Joint Operations
2. Joint Venture
PFRS for SME’s:
1. Joint Controlled Assets
2. Jointly Controlled Operations
3. Jointly Controlled Entities (JCE)
JCE
1. Passive = < 20%
2. Significant Influence = 20% to 50% (Associate)
3. Control = < 50% (Sole or Subsidiary)
4. Joint Control = Joint Arrangement
Characteristics of Joint Arrangement:
1. Contractual – written/oral.
2. Contractual Joint Control – required of unanimous consent on decisions for relevant activities.
Accounting for Joint Arrangement:
1. Joint Operations - without separate vehicle.
- with separate vehicle, parties have the right to assets and obligations to the
liabilities of the separate vehicle.
2. Joint Venture - with separate vehicle, parties have the rights to the net assets of the separate
vehicle.
- cannot recognize share in net loss if it will result in a negative balance in
investment; recognize only up to the extent of the investment balance.
Full PFRS:
1. Joint Operations
2. Joint Venture
PFRS for SME’s:
1. Joint Controlled Assets
2. Jointly Controlled Operations
3. Jointly Controlled Entities (JCE)
JCE
