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Accounting for Acquisitions of Interests in Joint Operations (Amendments to IFRS 11) [Completed]

Effective date:  Annual periods beginning on or after January 1, 2016.  Earlier adoption permitted.

Transitional provisions:

To be applied prospectively, effective for annual periods beginning on or after January 1, 2016.  Earlier adoption is permitted.

Last updated:

May 2014

Overview

Previously IFRS 11 did not give explicit guidance on the accounting for acquisitions of interests in joint operations. The objective of the amendments is to add new guidance to IFRS 11 on accounting for the acquisition of an interest in a joint operation in which the activity of the joint operation constitutes a business, as defined in IFRS 3, Business Combinations. Acquirers of such interests are to apply the relevant principles on business combination accounting in IFRS 3 and other standards, as well as disclosing the relevant information specified in these standards for business combinations.

The most significant impacts will be the recognition of goodwill (when there is an excess of consideration transferred over the identifiable net assets acquired) and the recognition of deferred tax assets and liabilities. Of note, the amendments apply not only to acquisitions of interests in joint operations but also when a business is contributed to a joint operation on its formation.

Other developments

May 2014

On May 6, 2014, the IASB issued Amendments to IFRS 11, Joint Arrangements: Accounting for Acquisitions of Interests in Joint Operations.

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.