.jpg)
IAS 27 – SEPARATE FINANCIAL STATEMENTS
IAS
27 contains accounting and disclosure requirements for investments in
subsidiaries, joint ventures and associates when an entity prepares separate
financial statements.
IAS
27 requires an entity preparing separate financial statements to account for
those investments at cost or in
accordance with IFRS 9.
Separate Financial Statements are those
presented by a parent or an investor with joint control of, or significant
influence over, an investee, in which the investments are accounted for at cost or in accordance with IFRS 9.
Separate
financial statements are those presented in addition to consolidated financial
statements or in addition to financial statements in which investment in
associates or joint ventures are accounted for using the equity method.
Note:
However
if a company is exempt from the need to consolidate or account for an
investment using the equity method, the separate financial statements are its
only financial statements.
Preparation of Separate Financial
Statements
Separate
financial statements must be prepared in accordance with all applicable IFRSs.
Investments
in subsidiaries, joint ventures and associates must be accounted for in
separate financial statements, either at cost
or in accordance with IFRS 9 or
using the equity method.
A
company must apply the same accounting for each category of investments.
Investments
accounted for at cost are subject to
the rules in IFRS 5 when they are
classified as held for sale.
IAS 28 allows an entity to measure its
investments in associates or joint ventures at fair value through profit or loss. Such investments must be
accounted for in the same way in its separate financial statements.
Dividends
are recognised in profit or loss in separate financial statements when the
right to receive the dividend is established.
DISCLOSURE
A
parent should disclose the following when it prepares financial statements:
1.
the fact that the financial statements are separate financial statements.
2.
a list of significant investments in subsidiaries, joint ventures and
associates including:
a.
the name of those investees,
b.
the principal place of business,
c.
its proportion of the ownership interest.
3.
a description of the method used to account for the investment listed.
If
a parent is exempt from preparing consolidated financial statements and elects
not to do so, and instead prepares separate financial statements, it must
disclose:
1.
the fact that the financial statements are separate financial statements.
2.
that the exemption from consolidation has been used.
3.
the name and principal place of business of the entity whose consolidated
financial statements that comply with IFRS have been produced for public use.
4. the address where those consolidated financial statements are obtainable.