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CMA Final · Corporate Financial Reporting · Consolidated Financial Statements and Separate Financial Statements

Under Ind AS 28, how must an investment in an associate or joint venture be accounted for in the entity's separate financial statements?

Paragraph 44 of Ind AS 28 requires an investment in an associate or joint venture to be accounted for in the entity's separate financial statements in accordance with paragraph 10 of Ind AS 27. It does not require line-by-line consolidation or leave the investment unrecognised.

  1. AIn accordance with paragraph 10 of Ind AS 27Correct
  2. BBy the equity method only, with no other option
  3. CBy line-by-line consolidation of the investee
  4. DIt is not recognised, with only dividends shown as income

Explanation

Paragraph 44 of Ind AS 28 states that an investment in an associate or joint venture is accounted for in the entity's separate financial statements in accordance with paragraph 10 of Ind AS 27. It does not prescribe the equity method as the only treatment there, and the investment is recognised.

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