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INVESTMENTS IN ASSOCIATES AND JOINT VENTURES

Transactions Between Investor & Associate (.28)

• Note : What is in the starting and ending points?

• Upstream transactions

• Affect associate’s profits but asset is with investor

• Downstream transactions

• Affect investor’s profit but asset is with associate

• Uniform accounting policies must be used in the group

financials (.35)

• Adjustments made if associate uses different accounting
policies (.36)

• If the associate has non-redeemable cumulative

preference shares classified as equity (.37)

• Principles are same as with subs

• The investor’s share of profit is calculated after preference

dividends allocated

• Even if the dividend has not been declared
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