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CA Final · Financial Reporting · Ind AS 111 Joint Arrangements

Ind AS 111 states that a joint arrangement is of one of two types only. Which of the following correctly describes the classification of a joint arrangement under the Standard?

Under Ind AS 111, every joint arrangement is classified as either a joint operation or a joint venture. No third category exists. Subsidiaries and associates are dealt with under other Standards, so they are not types of joint arrangement.

  1. AA joint arrangement is either a joint operation or a joint ventureCorrect
  2. BA joint arrangement is either a subsidiary or an associate
  3. CA joint arrangement is either a joint operation or an associate
  4. DA joint arrangement is a joint venture, a joint operation or a jointly held investment

Explanation

The Standard says a joint arrangement is either a joint operation or a joint venture. There is no third category. Options that bring in subsidiaries, associates or jointly held investments describe other Standards (Ind AS 110, Ind AS 28, Ind AS 109), not the classification in Ind AS 111.

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