SEPARATE FINANCIAL STATEMENTS

IAS 27

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Objective & scope
❑ IAS27 prescribes accounting principles on how to
account for the cost of an investment in the separate
records of an investor for investments in
subsidiaries, joint arrangements & associates
❑ IAS 27 does not mandate which entities should
present.
❑ Presented when an entity elects or required by local
regulations.

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Definitions

❑ Separate financial statements are:

Financial statements presented by a parent or an
investor with joint control of, or significant
influence over an investee
in which investment accounted for at cost, at FV
or using equity method

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Definitions

N.B. Should an entity be exempted from

consolidation in terms of IFRS10 or applying the
equity method in terms of IAS28, it may present
separate financial statements as its only financial
statements.

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Definitions

❑ Consolidated financial statements are:

financial statements of a group in which assets,
liabilities , income , expenses & cash flows of the
parent & subsidiaries
are presented as those of a single economic entity

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Preparation of separate financial
statements
❑ Investments in subsidiaries, JVs & associates
at cost,
at FV (IFRS9) 0r
using equity method
NB: Entity required to use the same accounting for
each category of investments

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Preparation of separate financial statements
❑ Investments in subsidiaries, JVs & associates
classified as held for sale in accordance with IFRS5 if
previously accounted for at cost (measure asset at lower of carrying
amount and FV less costs to sell)

in accordance with IFRS9 if previously

accounted per IFRS9
❑ Investments in JVs & associates at FV
per IFRS9

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Preparation of separate financial
statements

❑ Dividends received
always recognised in P/L in separate financial
statements irrespective of whether from pre- or
post-acquisition.

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Preparation of separate financial
statements

consider impairment of investment if:

▪ CA of investment in SFS exceeds the CA in CFS
▪ dividend received exceeds total comprehensive
income of investee

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Preparation of separate financial
statements

recognised when right to receive dividend

established
accounted for:
• in profit or loss in case of cost or FV acc.
• as a reduction of CA case of equity acc.

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Disclosure
❑ Parent elects not to present CFS
fact that FS are SFS
fact that exemption from consolidation has been
used
the name, principal place of business (& country of
incorporation if different)
list of significant investments in subs, jv +ass
accounting method

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Disclosure
❑ All other parents & investors in associates & JV
the fact that FS are SFS
why prepare if not required by law
list of significant investments in subs, jv +ass
accounting method
identification of CFS (IAS 28 0R IFRS 11) to
which SFS relate

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 IAS27

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