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IAS 27 — Accounting for put options written over non-controlling interests

Date recorded:

The IASB discussed the recommendations of the IFRS Interpretation Committee regarding the accounting for changes in the carrying amount of a financial liability for a put option, written over shares held by a non-controlling shareholder ('NCI put').

The IFRS Interpretation Committee concluded that financial liability recognised for a NCI put shall be subsequently measured in accordance with IAS 39 and changes in the carrying amount of financial liabilities should recognised in profit or loss. However, the Committee noted that additional accounting concerns exist relating to the accounting for NCI puts, mainly related to net presentation of the NCI put as well as the rationale for recognising changes in profit or loss when they relate to NCI. Consequently, the Interpretation Committee referred the issues to the Board to be considered more broadly as part of the Financial Instruments with Characteristics of Equity (FICE) project. Additionally, the Committee did not want to issue guidance that might be contradicting the conclusion that might be reached in the FICE project.

One IASB member asked will be the guidance in the interim period until the FICE project is finalised and effective. No conclusion has been reached. The Board proceed to discuss the status of the broader FICE project.