Mazars IFRS Insights
IFRS 11 was published by the IASB in May 2011. It will replace IAS 31 on joint ventures. IFRS 11 introduces the distinction between "joint operations" and "joint ventures".
This distinction is based on analysing the rights and obligations of partners in respect of assets and liabilities relating to the joint arrangement. The accounting treatment under IFRS 11 depends on whether the joint arrangement is a joint operation or a joint venture, knowing that joint ventures shall be mandatorily accounted for using the equity method.
At a time when Europe is thinking about the adoption of this standard – an adoption with an effective date extended to 1 January 2014 being a probable hypothesis - practical issues begin to arise for groups wishing to anticipate impacts of this new standard on their consolidated financial statements.
Our publication aims to present the main provisions of the standard and to provide examples of application, while alerting the reader on topics that deserve to be clarified for a consistent and coherent application across groups.”