Long-term Interests in Associates and Joint Ventures (Amendments to IAS 28) [Completed]
Effective date: |
The amendments are effective for periods beginning on or after January 1, 2019. Earlier application is permitted. This will enable entities to apply the amendments together with IFRS 9, if they wish so, but leaves other entities additional implementation time. The AcSB issued the final Handbook material in November 2017. |
Transitional provisions: |
The amendments are to be applied retrospectively, but they provide transition requirements similar to those in IFRS 9 for entities that apply the amendments after they first apply IFRS 9. They also include relief from restating prior periods for entities electing, in accordance with IFRS 4, Insurance Contracts, to apply the temporary exemption from IFRS 9. Full retrospective application is permitted if that is possible without the use of hindsight. |
Last updated: |
November 2017 |
Overview
This item was initially included in the Annual Improvements 2015-2017 Project, but has been moved in May 2017 to its own separate project.
The issue relates to whether the measurement, in particular relating to impairment, of long term interests in associates and joint ventures that, in substance, form part of the ‘net investment’ in the associate or joint venture should be governed by IFRS 9, IAS 28 or a combination of both.
IFRS 9, Financial Instruments excludes interests in associates and joint ventures accounted for in accordance with IAS 28, Investments in Associates and Joint Ventures. However, some stakeholders have said it is not clear whether that exclusion applies only to interests in associates and joint ventures to which the equity method is applied.
In this amendment the IASB clarified that the exclusion in IFRS 9 applies only to interests a company accounts for using the equity method. A company applies IFRS 9 to other interests in associates and joint ventures, including long-term interests to which the equity method is not applied and that, in substance, form part of the net investment in those associates and joint ventures.
In October 2017, the Board issued Long-term interests in Associates and Joint Ventures (Amendments to IAS 28). The amendments clarify that a company applies IFRS 9 Financial Instruments to long-term interests in an associate or joint venture that form part of the net investment in the associate or joint venture.
Other developments
November 2017
On November 1, 2017, the AcSB issued the final Handbook material.
October 2017
On October 12, 2017, the IASB published Long-term Interests in Associates and Joint Ventures (Amendments to IAS 28) to clarify that an entity applies IFRS 9 "Financial Instruments" to long-term interests in an associate or joint venture that form part of the net investment in the associate or joint venture but to which the equity method is not applied.
July 2017
On July 21, 2017, the staff of the IASB updated the work plan to indicate that the IASB expects to issue the final amendments to IAS 28 in October 2017.
June 2017
In June 2017, the IASB staff updated the work plan to indicate that the IASB expects to issue the final amendments to IAS 28 in September 2017.
May 2017
On May 18, 2017, the IASB staff issued an updated Work Plan which indicates that this in respect of Long-term Interests in Associates and Joint Ventures (Amendments to IAS 28) has been moved to its own separate project.
February 2017
On February 9, 2017, the AcSB issued an Exposure Draft that corresponds to the IASB’s Exposure Draft. Stakeholders are encouraged to submit their comments by April 12, 2017.
January 2017
On January 12, 2017, the IASB published an Exposure Draft, Annual Improvements to IFRS Standards 2015–2017 Cycle. It contains proposed amendments to three IFRSs as result of the IASB's annual improvements project. Comments are requested by April 12, 2017.
October 2015
In October 2015, the IASB formally added the Annual Improvements to IFRSs 2015-2017 Cycle project to its agenda. An exposure draft is expected in 2016 at the earliest.