Disclosure of Interests in Other Entities
(a)
the nature of, and risks associated with, its interests in other entities ; and
(b)
the effects of those interests on its financial position, financial performance and cash flows.
(a)
the significant judgements and assumptions it has made in determining:
(i)
the nature of its interest in another entity or arrangement;
(ii)
the type of joint arrangement in which it has an interest ( paragraphs 7 – 9 );
(iii)
that it meets the definition of an investment entity, if applicable ( paragraph 9A ); and
(b)
information about its interests in:
(i)
subsidiaries ( paragraphs 10- 19 );
(ii)
arrangements and associates ( paragraphs 20 – 23 ); and
(iii)
structured entities that are not controlled by the entity (unconsolidated structured entities) ( paragraphs 24 – 31 ).
(a)
subsidiaries
(b)
joint arrangements (ie joint operations or joint ventures)
(c)
associates
(d)
unconsolidated structured entities.
(a)
post-employment benefit plans or other long-term employee benefit plans to which Ind AS 19, Employee Benefits , applies.
(b)
2 an entity’s separate financial statements to which Ind AS 27, Separate Financial Statements , applies. However,
(i)
if an entity has interests in unconsolidated structured entities and prepares separate financial statements as its only financial statements, it shall apply the requirements in paragraphs 24 – 31 when preparing those separate financial statements.
(ii)
an investment entity that prepares financial statements in which all of its subsidiaries are measured at fair value through profit or loss in accordance with paragraph 31 of Ind AS 110 shall present the disclosures relating to investment entities required by this Ind AS.
(c)
an interest held by an entity that participates in, but does not have joint control of, a joint arrangement unless that interest results in significant influence over the arrangement or is an interest in a structured entity .
(d)
an interest in another entity that is accounted for in accordance with Ind AS 109, Financial Instruments . However, an entity shall apply this Ind AS:
(i)
when that interest is an interest in an associate or a joint venture that, in accordance with I nd AS 28, Investments in Associates and Joint Ventures , is measured at fair value through profit or loss; or
(ii)
when that interest is an interest in an unconsolidated structured entity.
(a)
that it has control of another entity, ie an investee as described in paragraphs 5 and 6 of Ind AS 110, Consolidated Financial Statements ;
(b)
that it has joint control of an arrangement or significant influence over another entity; and
(c)
the type of joint arrangement (ie joint operation or joint venture) when the arrangement has been structured through a separate vehicle.
(a)
it does not control another entity even though it holds more than half of the voting rights of the other entity.
(b)
it controls another entity even though it holds less than half of the voting rights of the other entity.
(c)
it is an agent or a principal (see paragraphs B58 – B72 of Ind AS 110 ).
(d)
it does not have significant influence even though it holds 20 per cent or more of the voting rights of another entity.
(e)
it has significant influence even though it holds less than 20 per cent of the voting rights of another entity.
(a)
the total fair value, as of the date of change of status, of the subsidiaries that cease to be consolidated;
(b)
the total gain or loss, if any, calculated in accordance with paragraph B101 of Ind AS 110 ; and
(c)
the line item(s) in profit or loss in which the gain or loss is recognised (if not presented separately).
(a)
to understand:
(i)
the composition of the group; and
(ii)
the interest that non-controlling interests have in the group’s activities and cash flows ( paragraph 12 ); and
(b)
to evaluate:
(i)
the nature and extent of significant restrictions on its ability to access or use assets, and settle liabilities, of the group (paragraph 13);
(ii)
the nature of, and changes in, the risks associated with its interests in consolidated structured entities ( paragraphs 14 – 17 );
(iii)
the consequences of changes in its ownership interest in a subsidiary that do not result in a loss of control ( paragraph 18 ); and
(iv)
the consequences of losing control of a subsidiary during the reporting period ( paragraph 19 ).
(a)
the date of the end of the reporting period of the financial statements of that subsidiary; and
(b)
the reason for using a different date or period.
(a)
the name of the subsidiary.
(b)
the principal place of business (and country of incorporation if different from the principal place of business) of the subsidiary.
(c)
the proportion of ownership interests held by non-controlling interests.
(d)
the proportion of voting rights held by non-controlling interests, if different from the proportion of ownership interests held.
(e)
the profit or loss allocated to non-controlling interests of the subsidiary during the reporting period.
(f)
accumulated non-controlling interests of the subsidiary at the end of the reporting period.
(g)
summarised financial information about the subsidiary (see paragraph B10 ).
(a)
significant restrictions (eg statutory, contractual and regulatory restrictions) on its ability to access or use the assets and settle the liabilities of the group, such as:
(i)
those that restrict the ability of a parent or its subsidiaries to transfer cash or other assets to (or from) other entities within the group.
(ii)
guarantees or other requirements that may restrict dividends and other capital distributions being paid, or loans and advances being made or repaid, to (or from) other entities within the group.
(b)
the nature and extent to which protective rights of non-controlling interests can significantly restrict the entity’s ability to access or use the assets and settle the liabilities of the group (such as when a parent is obliged to settle liabilities of a subsidiary before settling its own liabilities, or approval of non-controlling interests is required either to access the assets or to settle the liabilities of a subsidiary).
(c)
the carrying amounts in the consolidated financial statements of the assets and liabilities to which those restrictions apply.
(a)
the type and amount of support provided, including situations in which the parent or its subsidiaries assisted the structured entity in obtaining financial support; and
(b)
the reasons for providing the support.
(a)
the portion of that gain or loss attributable to measuring any investment retained in the former subsidiary at its fair value at the date when control is lost; and
(b)
the line item(s) in profit or loss in which the gain or loss is recognised (if not presented separately).
(a)
the subsidiary’s name;
(b)
the principal place of business (and country of incorporation if different from the principal place of business) of the subsidiary; and
(c)
the proportion of ownership interest held by the investment entity and, if different, the proportion of voting rights held.
(a)
the nature and extent of any significant restrictions (eg resulting from borrowing arrangements, regulatory requirements or contractual arrangements) on the ability of an unconsolidated subsidiary to transfer funds to the investment entity in the form of cash dividends or to repay loans or advances made to the unconsolidated subsidiary by the investment entity; and
(b)
any current commitments or intentions to provide financial or other support to an unconsolidated subsidiary, including commitments or intentions to assist the subsidiary in obtaining financial support.
(a)
the type and amount of support provided to each unconsolidated subsidiary; and
(b)
the reasons for providing the support.
(a)
the nature, extent and financial effects of its interests in joint arrangements and associates, including the nature and effects of its contractual relationship with the other investors with joint control of, or significant influence over, joint arrangements and associates (paragraphs 21 and 22); and
(b)
the nature of, and changes in, the risks associated with its interests in joint ventures and associates ( paragraph 23 ).
(a)
for each joint arrangement and associate that is material to the reporting entity:
(i)
the name of the joint arrangement or associate.
(ii)
the nature of the entity’s relationship with the joint arrangement or associate (by, for example, describing the nature of the activities of the joint arrangement or associate and whether they are strategic to the entity’s activities).
(iii)
the principal place of business (and country of incorporation, if applicable and different from the principal place of business) of the joint arrangement or associate.
(iv)
the proportion of ownership interest or participating share held by the entity and, if different, the proportion of voting rights held (if applicable).
(b)
for each joint venture and associate that is material to the reporting entity:
(i)
whether the investment in the joint venture or associate is measured using the equity method or at fair value.
(ii)
summarised financial information about the joint venture or associate as specified in paragraphs B12 and B13 .
(iii)
if the joint venture or associate is accounted for using the equity method, the fair value of its investment in the joint venture or associate, if there is a quoted market price for the investment.
(c)
financial information as specified in paragraph B16 about the entity’s investments in joint ventures and associates that are not individually material:
(i)
in aggregate for all individually immaterial joint ventures and, separately,
(ii)
in aggregate for all individually immaterial associates.
(a)
the nature and extent of any significant restrictions (eg resulting from borrowing arrangements, regulatory requirements or contractual arrangements between investors with joint control of or significant influence over a joint venture or an associate) on the ability of joint ventures or associates to transfer funds to the entity in the form of cash dividends, or to repay loans or advances made by the entity.
(b)
when the financial statements of a joint venture or associate used in applying the equity method are as of a date or for a period that is different from that of the entity:
(i)
the date of the end of the reporting period of the financial statements of that joint venture or associate; and
(ii)
the reason for using a different date or period.
(c)
the unrecognised share of losses of a joint venture or associate, both for the reporting period and cumulatively, if the entity has stopped recognising its share of losses of the joint venture or associate when applying the equity method.
(a)
commitments that it has relating to its joint ventures separately from the amount of other commitments as specified in paragraphs B18 – B20 .
(b)
in accordance with Ind AS 37, Provisions, Contingent Liabilities and Contingent Assets , unless the probability of loss is remote, contingent liabilities incurred relating to its interests in joint ventures or associates (including its share of contingent liabilities incurred jointly with other investors with joint control of, or significant influence over, the joint ventures or associates), separately from the amount of other contingent liabilities.
(a)
to understand the nature and extent of its interests in unconsolidated structured entities (paragraphs 26–28); and
(b)
to evaluate the nature of, and changes in, the risks associated with its interests in unconsolidated structured entities ( paragraphs 29 – 31 ).
(a)
how it has determined which structured entities it has sponsored;
(b)
income from those structured entities during the reporting period, including a description of the types of income presented; and
(c)
the carrying amount (at the time of transfer) of all assets transferred to those structured entities during the reporting period.
(a)
the carrying amounts of the assets and liabilities recognised in its financial statements relating to its interests in unconsolidated structured entities.
(b)
the line items in the balance sheet in which those assets and liabilities are recognised.
(c)
the amount that best represents the entity’s maximum exposure to loss from its interests in unconsolidated structured entities, including how the maximum exposure to loss is determined. If an entity cannot quantify its maximum exposure to loss from its interests in unconsolidated structured entities it shall disclose that fact and the reasons.
(d)
a comparison of the carrying amounts of the assets and liabilities of the entity that relate to its interests in unconsolidated structured entities and the entity’s maximum exposure to loss from those entities.
(a)
the type and amount of support provided, including situations in which the entity assisted the structured entity in obtaining financial support; and
(b)
the reasons for providing the support.
(a)
subsidiaries;
(b)
joint ventures;
(c)
joint operations;
(d)
associates; and
(e)
unconsolidated structured entities.
(a)
nature of activities (eg a research and development entity, a revolving credit card securitisation entity).
(b)
industry classification.
(c)
geography (eg country or region)
(a)
dividends paid to non-controlling interests.
(b)
summarised financial information about the assets, liabilities, profit or loss and cash flows of the subsidiary that enables users to understand the interest that non-controlling interests have in the group’s activities and cash flows. That information might include but is not limited to, for example, current assets, non-current assets, current liabilities, non-current liabilities, revenue, profit or loss and total comprehensive income.
(a)
dividends received from the joint venture or associate.
(b)
summarised financial information for the joint venture or associate (see paragraphs B14 and B15 ) including, but not necessarily limited to:
(i)
current assets.
(ii)
non-current assets.
(iii)
current liabilities.
(iv)
non-current liabilities.
(v)
revenue.
(vi)
profit or loss from continuing operations.
(vii)
post-tax profit or loss from discontinued operations.
(viii)
other comprehensive income.
(ix)
total comprehensive income.
(a)
cash and cash equivalents included in paragraph B12(b)(i).
(b)
current financial liabilities (excluding trade and other payables and provisions) included in paragraph B12(b)(iii).
(c)
non-current financial liabilities (excluding trade and other payables and provisions) included in paragraph B12(b)(iv).
(d)
depreciation and amortisation.
(e)
interest income.
(f)
interest expense.
(g)
income tax expense or income.
(a)
the amounts included in the Ind AS financial statements of the joint venture or associate shall be adjusted to reflect adjustments made by the entity when using the equity method, such as fair value adjustments made at the time of acquisition and adjustments for differences in accounting policies.
(b)
the entity shall provide a reconciliation of the summarised financial information presented to the carrying amount of its interest in the joint venture or associate.
(a)
the entity measures its interest in the joint venture or associate at fair value in accordance with Ind AS 28 ; and
(b)
the joint venture or associate does not prepare Ind AS financial statements and preparation on that basis would be impracticable or cause undue cost.
(a)
profit or loss from continuing operations.
(b)
post-tax profit or loss from discontinued operations.
(c)
other comprehensive income.
(d)
total comprehensive income.
(a)
unrecognised commitments to contribute funding or resources as a result of, for example:
(i)
the constitution or acquisition agreements of a joint venture (that, for example, require an entity to contribute funds over a specific period).
(ii)
capital-intensive projects undertaken by a joint venture.
(iii)
unconditional purchase obligations, comprising procurement of equipment, inventory or services that an entity is committed to purchasing from, or on behalf of, a joint venture.
(iv)
unrecognised commitments to provide loans or other financial support to a joint venture.
(v)
unrecognised commitments to contribute resources to a joint venture, such as assets or services.
(vi)
other non-cancellable unrecognised commitments relating to a joint venture.
(b)
unrecognised commitments to acquire another party’s ownership interest (or a portion of that ownership interest) in a joint venture if a particular event occurs or does not occur in the future.
(a)
restricted activities.
(b)
a narrow and well-defined objective, such as to effect a tax- efficient lease, carry out research and development activities, provide a source of capital or funding to an entity or provide investment opportunities for investors by passing on risks and rewards associated with the assets of the structured entity to investors.
(c)
insufficient equity to permit the structured entity to finance its activities without subordinated financial support.
(d)
financing in the form of multiple contractually linked instruments to investors that create concentrations of credit or other risks (tranches).
(a)
securitisation vehicles.
(b)
asset-backed financings.
(c)
some investment funds.
(a)
the terms of an arrangement that could require the entity to provide financial support to an unconsolidated structured entity (eg liquidity arrangements or credit rating triggers associated with obligations to purchase assets of the structured entity or provide financial support), including:
(i)
a description of events or circumstances that could expose the reporting entity to a loss.
(ii)
whether there are any terms that would limit the obligation.
(iii)
whether there are any other parties that provide financial support and, if so, how the reporting entity’s obligation ranks with those of other parties.
(b)
losses incurred by the entity during the reporting period relating to its interests in unconsolidated structured entities.
(c)
the types of income the entity received during the reporting period from its interests in unconsolidated structured entities.
(d)
whether the entity is required to absorb losses of an unconsolidated structured entity before other parties, the maximum limit of such losses for the entity, and (if relevant) the ranking and amounts of potential losses borne by parties whose interests rank lower than the entity’s interest in the unconsolidated structured entity.
(e)
information about any liquidity arrangements, guarantees or other commitments with third parties that may affect the fair value or risk of the entity’s interests in unconsolidated structured entities.
(f)
any difficulties an unconsolidated structured entity has experienced in financing its activities during the reporting period.
(g)
in relation to the funding of an unconsolidated structured entity, the forms of funding (eg commercial paper or medium-term notes) and their weighted-average life. That information might include maturity analyses of the assets and funding of an unconsolidated structured entity if the structured entity has longer-term assets funded by shorter-term funding.
Notes, amendments & references (7)
# This Ind AS was notified vide G.S.R. 111(E) dated 16 t h February, 2015 and was amended vide Notification No. G.S.R. 365(E) dated 30 t h March, 2016 and G.S.R. 310(E) dated 28 t h March, 2018.
1 Inserted vide Notification No. G.S.R. 310(E) dated 28 th March, 2018.
2 Substituted vide Notification No. G.S.R. 365(E) dated 30 th March, 2016.
3 Substituted vide Notification No. G.S.R. 310(E) dated 28 th March, 2018.
4 Appendix inserted vide Notification No. G.S.R. 310(E) dated 28th March, 2018.
* Refer Appendix 1
5 Inserted vide Notification No. G.S.R. 310(E) dated 28 th March, 2018.