Tuesday 02 September 2014
The objective of this narrow-scope project is to restore the option to use the equity method of accounting in separate financial statements.
Prior to the revision in 2003 of IAS 27 Consolidated and Separate Financial Statements and IAS 28 Investments in Associates, the equity method was one of the options available to an entity to account for investments in subsidiaries and associates in the entity’s separate financial statements. In 2003, the equity method was removed from the options.
IAS 27 Separate Financial Statements allows an entity to account for investments in subsidiaries, joint ventures and associates either at cost or in accordance with IFRS 9 Financial Instruments in the entity’s separate financial statements.
In their responses to the IASB’s 2011 Agenda Consultation some respondents suggested that the IASB should restore the option to use the equity method because use of the equity method was the only difference between the separate financial statements prepared in accordance with IFRS and those prepared in accordance with the local regulations in certain jurisdictions.
IASB publishes narrow-scope amendments to IAS 27 Separate Financial Statements
The IASB tentatively decided to finalise the proposed amendments to IAS 27
The IASB tentatively decided to proceed with the proposed amendments to IAS 27
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