Type of Investment and Accounting Method

type of investment and accounting methods:Indirect Investments:
Types of Investments and Accounting Method

No Significant Influence, Joint Control or Control
Significant Influence


Cost or FV Method
(AASB 9)
Consolidation Method
(AASB 10, AASB 3)
(Topic 7,8,9)

Equity Method
(AASB 128)
(Topic 10)
JV = Equity Method
JO = Share of interest
(AASB 128 &
AASB 11)
(Topic 10)

Joint Control

Joint Arrangement

London Ltd:
signi: power to participate
control: power over investee return.
1 of factor: share owenership have power over because they have voting right =) power but nguoc lai ko dung. some time preference share dont have voting right. 60 % of share, 60% of vote. AGM so can control meeting. share owership generally is the indicate of power. for example 3 of 5 member of board. if u control 3 out of 5 member of the board director so u control the board. =) u have power. even u have biggest owership >20% not enough to control. contractula to make financial and report dicision => significant influence.
only power is 1/3 of the answer. example from text book and standard

AASB 10:
6   An investor controls an investee when it 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.
7   Thus, an investor controls an investee if and only if the investor has all the following: (a) power over the investee (see paragraphs 10–14); (b) exposure, or rights, to variable returns from its involvement with the investee (see paragraphs 15 and 16); and (c) the ability to use its power over the investee to affect the amount of the investor’s returns (see paragraphs 17 and 18).
10   An investor has power over an investee when the investor has existing rights that give it the current ability to direct the relevant activities, ie the activities that significantly affect the...