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Sir how joint operations will be accounted for in individual and consolidated financial statements.
If we have already accounted for operators share of income, expenses, assets and liabilities in individual financial statements then when preparing Consolidated statements first we have to do is remove that share and instead record all assets liabilities and calculate goodwill.
I need guidance on these two issues:
1- Individual statements (operator’s share of the income, expenses, assets and liabilities will be recorded)
2- Consolidated statements (remove the operator’s share recorded and instead record all assets liabilities and calculate goodwill)Hi,
Are they not the same treatment? When you’ve accounted for it in the individual accounts of the subsidiary, do we not then consolidate as normal in the group accounts?
Thanks
There is no subsidiary, Only Entity and its Joint operation, let me rephrase it.
This thing is confusing me:If the joint operation meets the definition of a ‘business’ then the
principles in IFRS 3 Business Combinations apply when an interest in a
joint operation is acquired:
• Acquisition costs are expensed to profit or loss as incurred
• The identifiable assets and liabilities of the joint operation are
measured at fair value
• The excess of the consideration transferred over the fair value of the
net assets acquired is recognised as goodwill.At the reporting date, the individual financial statements of each joint
operator will recognise:
• its share of assets held jointly
• its share of liabilities incurred jointly
• its share of revenue from the joint operation
• its share of expenses from the joint operation.
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