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Joint Arrangements
| This summary of Accounting Standards Board (AcSB) projects has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on this project, which may change after further deliberations by the AcSB. Decisions to publish Handbook material are final only after a formal ballot process. |
Status: AcSB staff continues to monitor the IASB’s progress on this project.
Background
Activities to Date
Next Steps
Related Information
Contact Information
The IASB has a short-term convergence project to amend IAS 31, Interests in Joint Ventures, by removing the major difference between IAS 31 and US GAAP. The main change proposed is to require the use of the equity method of accounting for interests in jointly controlled entities. The existing option of proportionate consolidation for jointly controlled entities will be removed. Currently, Section 3055, Interests in Joint Ventures, requires these entities to be accounted for using proportionate consolidation. The IASB does not propose any change to the accounting for jointly controlled operations or jointly controlled assets, which is consistent with the proportionate consolidation method of the current Canadian standard, Section 3055.
The second objective of the IASB project on joint ventures is to consider the definitions of different categories of joint ventures. Currently, the definitions in IAS 31 do not adequately address the differences between an interest in a jointly controlled entity, and a direct interest in the underlying individual assets and liabilities of a joint arrangement. This now becomes imperative, because depending on how an item is defined will determine whether the equity or proportionate consolidation method of accounting is appropriate.
In September 2006, the AcSB added a project to its agenda to converge Section 3055, Interests in Joint Ventures, with the amended version of IAS 31, Interests in Joint Ventures.
In April 2008, the IASB discussed the comment letters received in response to the Exposure Draft ED 9 “Joint Arrangements.” Based on the feedback obtained from the comment letters, the IASB started its redeliberations on the areas of the ED where modifications are considered necessary.
The final standard will follow the timeframe of the IASB with an effective date that provides for an appropriate implementation period.
- Related Information
- Responses to the AcSB's Exposure Draft are available here
- IASB Project Page on Joint Ventures
Questions or comments on this project should be directed to:
Grace Lang, CA
Principal, Accounting Standards
Telephone: +1 (416) 204-3478
Fax: +1 (416) 204-3412
Canadian Accounting Standards Board
277 Wellington Street West
Toronto ON M5V 3H2 Canada