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IFRS 10 Consolidated Financial Statements
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- Associate
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An associate is an entity over which the investor has significant influence.
- Consolidated financial statements
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The financial statements of a group in which the assets, liabilities, equity, income, expenses and cash flows of the parent and its subsidiaries are presented as those of a single economic entity.
- Control of an investee
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An investor controls an investee when the investor is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
- Decision maker
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A decision maker is an entity with decision-making rights that is either a principal or an agent for other parties.
- Group
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A group is a parent and its subsidiaries.
- Investment entity
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An investment entity is an entity that: (a) obtains funds from one or more investors for the purpose of providing those investor(s) with investment management services; (b) commits to its investor(s) that its business purpose is to invest funds solely for returns from capital appreciation, investment income, or both; and (c) measures and evaluates the performance of substantially all of its investments on a fair value basis.
- Joint arrangement
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A joint arrangement is an arrangement of which two or more parties have joint control.
- Joint control
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Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.
- Joint operation
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A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement.
- Joint venture
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A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to net assets of the arrangement.
- Joint venturer
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A party to a joint venture that has joint control of that joint venture.
- Non-controlling interest
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Non-controlling interest is the equity in a subsidiary not attributable, directly or indirectly, to a parent.
- Parent
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A parent is an entity that controls one or more entities.
- Power
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Power is the existing rights that give the current ability to direct the relevant activities.
- Protective rights
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Protective rights are rights designed to protect the interest of the party holding those rights without giving that party power over the entity to which those rights relate.
- Relevant activities
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Relevant activities are activities of the investee that significantly affect the investee’s returns.
- Separate financial statements
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Separate financial statements are those presented by a parent (i.e., an investor with control of a subsidiary) or an investor with joint control of, or significant influence over, an investee, in which the investments are accounted for at cost or in accordance with IAS 39 Financial Instruments: Recognition and Measurement (or, if adopted, IFRS 9 Financial Instruments).
- Significant influence
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Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.
- Subsidiary
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A subsidiary is an entity that is controlled by another entity.
- Substantive rights
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For a right to be substantive, the holder must have the practical ability to exercise that right.