International Financial Reporting Standard 12 Disclosure of Interests in Other Entities
The objective of this IFRS is to require an entity to disclose information that enables users of its financial statements to evaluate:
(a) the nature of, and risks associated with, its interests in other entities;
and
(b) the effects of those interests
This IFRS shall be applied by an entity that has an interest in any of the
following:
(a) subsidiaries
(b) joint arrangements (ie joint operations or joint ventures)
(c) associates
(d) unconsolidated structured entities.
This IFRS does not apply to:
(a) post-employment benefit plans or other long-term employee benefit
plans to which IAS 19 Employee Benefits applies.
(b) an entity's separate financial statements to which IAS 27 Separate
Financial Statements applies.
However:
(i) if an entity has interests in unconsolidated structured entities and prepares separate financial statements as its only financial statements, it shall apply the requirements in paragraphs 24-31 when preparing those separate financial statements.
(ii) an investment entity that prepares financial statements in which all of its subsidiaries are measured at fair value through profit or loss in accordance with paragraph 31 of IFRS 10 shall present the disclosures relating to investment entities required by this IFRS.
(c) an interest held by an entity that participates in, but does not have joint control of, a joint arrangement unless that interest results in significant influence over the arrangement or is an interest in a structured entity.
(d) an interest in another entity that is accounted for in accordance with IFRS 9 Financial Instruments. However, an entity shall apply this IFRS:
(i) when that interest is an interest in an associate or a joint venture that, in accordance with IAS 28 Investments in Associates and Joint Ventures, is measured at fair value through profit orloss; or
(ii) when that interest is an interest in an unconsolidated structured entity.
An entity shall disclose information about significant judgements and assumptions it has made (and changes to those judgements and assumptions) in determining:
(a) that it has control of another entity, ie an investee as described in paragraphs 5 and 6 of IFRS 10 Consolidated Financial Statements;
(b) that it has joint control of an arrangement or significant influence
over another entity; and
(c) the type of joint arrangement (ie joint operation or joint venture)
when the arrangement has been structured through a separate vehicle.
The significant judgements and assumptions disclosed include those made by the entity when changes in facts and circumstances are such that the conclusion about whether it has control, joint control or significant influence changes during the reporting period.
An entity shall disclose, for example, significant judgements and assumptions made in determining that:
(a) it does not control another entity even though it holds more than half
of the voting rights of the other entity.
(b) it controls another entity even though it holds less than half of the
voting rights of the other entity.
(c) it is an agent or a principal (see paragraphs B58-B72 of IFRS 10).
(d) it does not have significant influence even though it holds 20 per cent
or more of the voting rights of another entity.
(e) it has significant influence even though it holds less than 20 per cent
of the voting rights of another entity.
When a parent determines that it is an investment entity in accordance with paragraph 27 of IFRS 10, the investment entity shall disclose
information about significant judgements and assumptions it has made in determining that it is an investment entity. If the investment entity does not have one or more of the typical characteristics of an investment entity (see paragraph 28 of IFRS 10), it shall disclose its reasons for concluding that it is nevertheless an investment entity.
and
following:
(a) subsidiaries
(b) joint arrangements (ie joint operations or joint ventures)
(c) associates
(d) unconsolidated structured entities.
This IFRS does not apply to:
(a) post-employment benefit plans or other long-term employee benefit
plans to which IAS 19 Employee Benefits applies.
(b) an entity's separate financial statements to which IAS 27 Separate
Financial Statements applies.
However:
(i) if an entity has interests in unconsolidated structured entities and prepares separate financial statements as its only financial statements, it shall apply the requirements in paragraphs 24-31 when preparing those separate financial statements.
(ii) an investment entity that prepares financial statements in which all of its subsidiaries are measured at fair value through profit or loss in accordance with paragraph 31 of IFRS 10 shall present the disclosures relating to investment entities required by this IFRS.
(c) an interest held by an entity that participates in, but does not have joint control of, a joint arrangement unless that interest results in significant influence over the arrangement or is an interest in a structured entity.
(d) an interest in another entity that is accounted for in accordance with IFRS 9 Financial Instruments. However, an entity shall apply this IFRS:
(i) when that interest is an interest in an associate or a joint venture that, in accordance with IAS 28 Investments in Associates and Joint Ventures, is measured at fair value through profit orloss; or
(ii) when that interest is an interest in an unconsolidated structured entity.
An entity shall disclose information about significant judgements and assumptions it has made (and changes to those judgements and assumptions) in determining:
(a) that it has control of another entity, ie an investee as described in paragraphs 5 and 6 of IFRS 10 Consolidated Financial Statements;
(b) that it has joint control of an arrangement or significant influence
over another entity; and
(c) the type of joint arrangement (ie joint operation or joint venture)
when the arrangement has been structured through a separate vehicle.
The significant judgements and assumptions disclosed include those made by the entity when changes in facts and circumstances are such that the conclusion about whether it has control, joint control or significant influence changes during the reporting period.
An entity shall disclose, for example, significant judgements and assumptions made in determining that:
(a) it does not control another entity even though it holds more than half
of the voting rights of the other entity.
(b) it controls another entity even though it holds less than half of the
voting rights of the other entity.
(c) it is an agent or a principal (see paragraphs B58-B72 of IFRS 10).
(d) it does not have significant influence even though it holds 20 per cent
or more of the voting rights of another entity.
(e) it has significant influence even though it holds less than 20 per cent
of the voting rights of another entity.
When a parent determines that it is an investment entity in accordance with paragraph 27 of IFRS 10, the investment entity shall disclose
information about significant judgements and assumptions it has made in determining that it is an investment entity. If the investment entity does not have one or more of the typical characteristics of an investment entity (see paragraph 28 of IFRS 10), it shall disclose its reasons for concluding that it is nevertheless an investment entity.