6.8 The IAS 28 equity method

Question 1

What is the “equity method” as set out in IAS 28?

Answer 1

A method of accounting for associates and joint ventures by initially recognizing the investment in the investors balance sheet at cost, and adjusting the carrying amount thereafter with the change in the investor’s share of the post-acquisition profit or loss.

Question 2

What is an alternative name for the “equity method” in IAS 28?

Answer 2

“One-line consideration”.