Non-monetary exchanges of assets

Date recorded:


The IFRIC considered an example of a transaction involving exchanges of non-monetary assets in which Company A exchanges its 13 per cent interest in Company B for a 13 per cent interest in Company C, where C’s only asset is its 100 per cent holding in B. As a result, A’s holding in B is held in a different legal form (ie via an intermediate holding company with no other activities), rather than held directly.  The issue is whether the exchange of A’s interest in B for the 13 per cent interest in C would result in derecognition of the investment in B with any gain or loss reported in profit or loss and recognition of a new investment in C.


Decision not to add

April 2003



The IFRIC agreed not to publish an Interpretation on this issue because the example is relatively narrow. However, the IFRIC agreed to consider including this example in its future guidance on Reporting Linked Transactions.

This issue is within the scope of a draft Interpretation considered by the IFRIC at the February 2003 meeting as part of the IFRIC project on Reporting Linked Transactions (though the draft Interpretation did not include a specific example on the topic).

However, the Board has not had an opportunity to consider the IFRIC’s progress on the Linkage program to date.


IFRIC reference: IFRS 3

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