Effective date of IFRS 11
On 12 May 2011, the IASB issued IFRS 11 Joint Arrangements, which is a replacement of IAS 31 Joint Ventures. IFRS 11 introduces new accounting requirements for joint arrangements, replacing IAS 31 Interests in Joint Ventures. The option to apply the proportional consolidation method when accounting for jointly controlled entities is removed.
Additionally, IFRS 11 eliminates jointly controlled assets to now only differentiate between joint operations and joint ventures. A joint operation is a joint arrangement whereby the parties that have joint control have rights to the assets and obligations for the liabilities. A joint venture is a joint arrangement whereby the parties that have joint control have rights to the net assets.
Concurrent with IFRS 11, the IASB also issued IFRS 10 Consolidated Financial Statements, IFRS 12 Disclosure of Involvement with Other Entities, IAS 27 Separate Financial Statements (2011) and IAS 28 Investments in Associates and Joint Arrangements.
Each of the standards in the 'package of five' has an effective date for annual reporting periods beginning on or after 1 January 2013, with earlier application permitted so long as each of the other standards in the 'package of five' is also early applied. However, entities are permitted to incorporate any of the disclosure requirements in IFRS 12 into their financial statements without early adopting IFRS 12 (and thereby the other standards in the 'package of five').