IAS 28 — Fund manager’s significant influence over a fund

Date recorded:

IAS 28 Investments in Associates and Joint Ventures — Fund manager’s significant influence over a fund — Agenda paper 11


The IC received a request to clarify whether, and how, a fund manager assesses if it has significant influence over a fund that it manages and in which it has a direct investment.

The IC discussed this issue back in 2014 and 2015 but decided to put it on hold as the IC believed that the issue would be better considered as a part of the Board’s comprehensive project on the equity method of accounting (the ‘Research Project’). A tentative agenda decision was issued in September 2014 to this effect. The IC reconfirmed its decision in January 2015 in light of comments received but did not proceed to finalise the agenda decision.

The purpose of this session is to update the IC with a summary of the issue and to ask the IC not to take the matter on its agenda. The proposed wording for the tentative agenda decision is included in Appendix A.

Staff analysis

The Staff did not present much new analysis. They reiterate that any attempt at developing requirements for decision makers when assessing significant influence would not be a narrow-scope project, and that such requirements could not be developed in isolation of a comprehensive review of the definition of significant influence in IAS 28. The Staff further notes that the Board and the project team responsible for the Research Project are already aware of the issue, and that the post-implementation review of IFRSs 10, 11 and 12 will soon be initiated during which the project team will gauge the information needs of users.

Staff recommendations

The Staff recommends that the IC not add this issue to its agenda for the reasons set out above and to issue a tentative agenda decision to that effect.

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