IAS 27

Hello Tutor,

IAS 27 Says,

”Dividends from a subsidiary, a joint venture or an associate are recognised in the separate financial statements of an entity when the entity’s right to receive the dividend is established. The dividend is recognised in profit or loss unless the entity elects to use the equity method, in which case the dividend is recognised as a reduction from the carrying amount of the investment.”

I don’t understand this point. Equity method is only used for associates and joint ventures, so if it elects to use equity method, then how will we account for divident from subsidiary here?

Thanks.