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IAS 27
Separate Financial
Statements
scope
When an entity elects (or is required by local
regulations) to present separate financial
statements, PAS 27 applies in accounting for:
Investments in subsidiaries
Joint ventures
Associates.
PAS 27 does not mandate which entities produce
separate financial statements.
DEFINITIONS
Separate financial statements
Financial statements presented by a
parent (i.e. an investor with control of
a subsidiary) or an investor with joint
control of; or significant influence over
an investee, in which the investments
are accounted for at cost or at fair
value.
Consolidated financial
statements
The financial statements of a
group in which the assets,
liabilities, equity, income,
expenses, and cash flows, of the
parent and its subsidiaries are
presented as a single economic
entity
Associated standards
IFRS 10 Consolidated Financial Statements
IFRS 11 Joint Arrangements
IAS 28 Investments in Associates and Joint Ventures.
For definitions of associate; control of an investee;
group; joint control; joint venture; joint venturer;
parent; significant influence; and subsidiary :
SEPARATE FINANCIAL STATEMENTS
Separate financial statements can, but are
not required to be presented in addition to
consolidated financial statements or, where
an entity does not have subsidiaries,
individual financial statements in which
investments in associates and joint ventures
are accounted for using the equity method.
Separate financial statements do not need
to be attached to, or accompany, those
consolidated or individual financial
statements
SEPARATE FINANCIAL STATEMENTS
Those in which the equity method is applied are not
separate financial statements. Also, financial statements of
an entity that does not have a subsidiary, associate or joint
venturer’s interest in a joint venture are not separate
financial statements
Investments are accounted for:
(i) At cost; or
(ii) in accordance with IFRS 9 Financial Instruments
An entity that is exempt in accordance with IFRS 10.4(a)
from consolidation or IAS 28.17 (as amended in 2011) from
applying the equity method may present separate financial
statements as its only financial statements.
PREPARATION OF SEPARATE
FINANCIAL STATEMENTS
Investment in subsidiaries, joint ventures, and associates
Accounted for at either:
1)Cost
2)In accordance with IFRS 9 (i.e. at fair value).
The entity is required to apply the same accounting for each
category of investments.
PREPARATION OF SEPARATE
FINANCIAL STATEMENTS
Investments in subsidiaries, joint ventures, and associates
classified as held for sale
When investments are classified as held for sale (or
included in a disposal group that is classified as held for
sale), they are accounted for:
In accordance with IFRS 5 Non-current Assets Held for Sale
and Discontinued Operations, if previously accounted for
at cost
In accordance with IFRS 9, if previously accounted for in
accordance with IFRS 9.
PREPARATION OF SEPARATE
FINANCIAL STATEMENTS
Investments in associates or joint ventures at fair value
Investments in associates or joint ventures that are
measured at fair value in accordance with IFRS 9 are
required to be measured in the same way in the separate
and consolidated financial statements (i.e. at fair value).
PREPARATION OF SEPARATE
FINANCIAL STATEMENTS
Dividends received
Dividends received from subsidiaries, joint ventures, and
associates are recognized in profit or loss in the parent’s
separate financial statements, when its right to receive the
dividend is established.
DISCLOSURE
An entity is required to apply all applicable IFRSs when
providing disclosures in its separate financial statements.
When a parent qualifies and elects not to prepare
consolidated financial statements (IFRS 10 paragraph 4(a))
and instead prepares separate financial statements, it is
required to disclose:
That the financial statements are separate financial
statements
That the paragraph 4(a) exemption has been used
The name, principal place of business, address, and country
of incorporation, of the entity whose IFRS compliant
consolidated financial statements are publicly available
DISCLOSURE
A list of significant investments in subsidiaries, joint
ventures and associates, including:
- The name of those investees
- The investees principal place of business and
country of incorporation
- The proportion of the ownership interest and its
proportion of the voting rights held in those
investees.
A description of the method used to account for
the investments listed under the previous bullet point.
DISCLOSURE
When a parent (other than a parent using
the consolidation exemption) or an investor
with joint control of, or significant influence
over, an investee prepares separate
financial statements, it is required to
disclose:
That the financial statements are
separate financial statements
The reasons why the separate financial
statements are prepared if not required by law
DISCLOSURE
A list of significant investments in subsidiaries, joint
ventures and associates, including:
- The name of those investees
- The investees principal place of business and
country of incorporation
- The proportion of the ownership interest and
the proportion of voting rights held in those
investees.
A description of the method used to account for
the investments listed
The financial statements prepared in
accordance with IFRS 10, IFRS 11, or IAS 28 to which
they relate.
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