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Equity Method (Possible amendments to IAS 28) [Research]

Next steps:

At a future meeting the Board will review the research findings on differences between the principles in IAS 28 and those in other IFRS Standards relating to business combinations and consolidation. The Board will also discuss application questions within the scope of the project and consider whether other application questions should be included in the scope of the project.

Last updated:

October 2021

Overview

The IASB is undertaking research to assess whether application problems with the equity method as set out in IAS 28 Investments in Associates and Joint Ventures can be addressed in consolidated and individual financial statements by identifying and explaining the principles of IAS 28.

The Board decided that the objective of the project is: to assess whether application problems with the equity method, as set out in IAS 28 Investments in Associates and Joint Ventures, can be addressed in consolidated and individual financial statements by identifying and explaining the principles of IAS 28.

The Board decided that, to achieve this objective, the project should be focused on:

  1. identifying application problems and deciding which of these problems to address; and
  2. addressing these application problems by identifying and explaining the principles that underlie IAS 28.

Identifying and explaining these principles may also help the Board develop new requirements, new application guidance or other amendments to the Standard.

Other developments

October 2020

On October 30, 2020, the IASB staff up­dated the Work Plan to in­di­cate that the Board plans to decide the project direction shortly (no date specified). 

On October 27, 2020, the Board met to discuss the objective and approach of the Equity Method research project. The Board decided that the objective of the project is: to assess whether application problems with the equity method, as set out in IAS 28 Investments in Associates and Joint Ventures, can be addressed in consolidated and individual financial statements by identifying and explaining the principles of IAS 28. The Board decided that, to achieve this objective, the project should be focused on: (a) identifying application problems and deciding which of these problems to address; and (b) addressing these application problems by identifying and explaining the principles that underlie IAS 28. Identifying and explaining these principles may also help the Board develop new requirements, new application guidance or other amendments to the Standard.

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