Abstract
This article deals with disclosure of associates and joint venture in financial statement. In May 2011 the IASB issued new standard IFRS 12 Disclosure of interest in other entities. This standard, compared with IAS 28 and IAS 31, requires to disclose more detail information about joint ventures and associates. The reason is elimination of proportionate consolidation for joint ventures and also users of financial statements requested improvements to the disclosure of a reporting entity's interests in other entities. The introductory section discusses the equity method and proportionate consolidation, which is followed by a chapter dealing with the disclosure of information relating to joint ventures and associates in the financial statements. The last part is devoted to an analysis of disclosed information relating to joint ventures associates in the financial statements of companies that are listed on the Prague Stock Exchange.
Highlights
In recent years, there has been a common project of consolidation, in which IASB and FASB were involved
Some users of financial statements were concerned that the elimination of proportionate consolidation would result in a loss of information
New disclosure requirement for joint ventures and associates should ensure that the elimination of proportionate consolidation will not cause the loss of information
Summary
There has been a common project of consolidation, in which IASB and FASB were involved The result of this project was issuing 3 new standards deals with the field of consolidation. Some users of financial statements were concerned that the elimination of proportionate consolidation would result in a loss of information (see IASB, 2011). Users of financial statements requested more detailed disclosures of joint ventures. Ašenbrenerová, P.: Disclosure of Joint Ventures and Associates in Financial Statement under IFRS. IASB responded by including additional disclosure requirements about joint ventures and associates in the new standard IFRS 12 Disclosure of Interests in other Entities (hereafter IFRS 12). This article focuses on disclosure requirements of equity investments and investigates whether the investors in their financial statements disclose all the requirements of IFRS 12. In the conclusion there are summarised the main findings, the limitations of the study are outlined, and the future stream of research in the area is proposed
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