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Accounting for an investment – April 2015 PEAC Meeting

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  • ASPE - Meeting Image

Apr 29, 2015

At its meeting on April 1, 2015, the Private Enterprise Advisory Committee discussed the following issues regarding the accounting for an investment using the cost method.

Inclusion of a Description of Cost

At its meeting on April 1, 2015, the Private Enterprise Advisory Committee agreed to recommend to the AcSB that a description of what comprises cost should be included in Section 3051.

Acquisition-related Costs on a Step Acquisition

The Committee agreed to recommend to the AcSB that previously capitalized transaction costs should not be required to be expensed but should continue to be included in the carrying amount of the investment when a step acquisition of an investee subject to significant influence occurs. This would be consistent with the accounting for the step acquisition of a subsidiary outlined above.

Transition provisions

The Committee agreed to recommend to the AcSB that the proposed amendments relating to the application of the cost method should be applied prospectively to new acquisitions of subsidiaries and investments accounted for using the cost method in accordance with Section 3051.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.