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An entity shall apply this PPSAS for annual financial statements covering periods beginning on January 1, 2014
venturers’ interest in jointly controlled held by mutual funds
NGA's
LGU's
4. A venturer shall disclose the method it uses to recognize its interests in jointly controlled entities. (Par. 64)
unit trust
1. A venturer shall disclose: (Par. 61)
(a) The aggregate amount of the following contingent liabilities, unless the possibility of any outflow in settlement is remote, separately from the amount of other contingent liabilities:
2. A venturer shall disclose the aggregate amount of the following commitments in respect of its interests in joint ventures separately from other commitments: (Par.62)
(i) Any contingent liabilities that the venturer has incurred in relation to its interests in joint ventures and its share in each of the contingent liabilities that have been incurred jointly with other venturers;
(ii) Its share of the contingent liabilities of the joint ventures themselves for which it is contingently liable; and
(iii) Those contingent liabilities that arise because the venturer is contingently liable for the liabilities of the other venturers of a joint venture; and
(a) Any capital commitments of the venturer in relation to its interests in joint ventures and its share in the capital commitments that have been incurred jointly with other venturers; and
(b) Its share of the capital commitments of the joint ventures themselves.
Disclosure
requirements
(b) A brief description of the following contingent assets and, where practicable, an estimate of their financial effect, where an inflow of economic benefits or service potential is probable:
Identify accounting methods used and
Learning Objectives
(i) Any contingent assets of the venturer arising in relation to its interests in joint ventures and its share in each of the contingent assets that have arisen jointly with other venturers; and
(ii) Its share of the contingent assets of the joint ventures themselves.
3. A venturer shall disclose a listing and description of interests in significant joint ventures and the proportion of ownership interest held in jointly controlled entities.
Differentiate joint ventures from its different forms
The venturer is not required to apply proportionate consolidation or equity method to an interest if:
similar entities including investment linked insurance funds
interest is acquired within twelve months from acquisition and that management is actively seeking a buyer; (IPSAS 29)
(a) the sale is in process at the reporting date,
(b) there is no reason to believe that it will not be completed shortly after the reporting date.
allowing a controlling entity that also has an interest in a jointly controlled entity not to present consolidated financial statements is applicable; or
All of the following apply:
GOCC's
A venturer with an interest in a jointly controlled entity is exempted from paragraphs 35 (proportionate consolidation) and 43 (equity method) when it meets the following conditions:
is the agreed sharing of control over an activity by a binding arrangement.
is a party to a joint venture and has joint control over that joint venture.
is a binding arrangement whereby two or more parties are committed to undertake an activity that is subject to joint control.
is the power to participate in the financial and operating policy decisions of an activity but is not control or joint control over those policies.
Definition
Accounting for Interests in Joint Venture
A venturer shall recognize its interest in a jointly controlled entity using proportionate consolidation or the alternative method described in paragraph 43 (equity method). When proportionate consolidation is used, one of the two reporting formats shall be used. (Par. 35)
Jointly Controlled
Assets
Jointly Controlled
Entities
Jointly Controlled
Operations
Operators or managers of a joint venture shall account for any fees in accordance with IPSAS 9, Revenue from Exchange Transactions. (Par. 59)
OPERATOR does not control the joint venture but acts within the financial and operating policies that have been agreed by the venturers. However, if the operator has the power to govern the financial and operating policies of the activity, it controls the joint venture and not considered as joint venturer.