IAS 28 equity accounting template
An Excel template that applies IAS 28 to an associate or joint venture from the day significant influence or joint control is obtained to the IFRS 12 note. It works out the cost and notional goodwill, the share of profit and OCI with fair value releases, upstream and downstream eliminations, losses beyond the investment, impairment and every change in ownership, then posts the journals and drafts the disclosures. It comes with a fully worked example for a fictitious Irish food group and its dairy ingredients associate.
What it does
Tests significant influence (IAS 28.5–8) and joint control with rights to the net assets (IFRS 11), and the IAS 28.17–19 exemptions.
Measures the cost of the investment, including a previously held interest at fair value or by cost accumulation, the investee’s net assets at fair value with deferred tax, and notional goodwill or a bargain purchase gain (IAS 28.32).
Calculates the share of profit and OCI over up to eight periods: present ownership, uniform accounting policies, reporting-date adjustments, cumulative preference dividends and the release of fair value adjustments.
Eliminates unrealised profits on upstream and downstream transactions with deferred tax, and restricts the gain on contributing non-monetary assets (IAS 28.28–31), with a choice of presenting downstream eliminations in the share of profit or in revenue.
Handles additional purchases, partial disposals with OCI reclassified, loss of significant influence, becoming a subsidiary, and classification as held for sale under IFRS 5, including dividends declared around the date of the change.
Limits losses to the investment and long-term interests (after IFRS 9, IAS 28.14A), provides for obligations, tracks unrecognised losses and their recovery, and tests the whole carrying amount for impairment and reversal (IAS 28.40–43).
Posts the journals for the period, reconciled to the investment account, and drafts the IFRS 12 note: the carrying amount table, summarised financial information, the reconciliation to the carrying amount, unrecognised losses, the accounting policy (IFRS 18 or IAS 1), an 18-point checklist and 18 automatic checks.
What you get
One Excel workbook (.xlsx) with Instructions, the blank template and a worked example covering a step acquisition, fair value adjustments, policy alignment, upstream and downstream sales, a contributed asset, an additional 10% purchase and an impairment.
Clearly marked input cells, protected formulas and built-in checks, with a status line on every tab.
Works in Microsoft Excel 2010 or later (Windows or Mac). No macros.
Scope
One associate or joint venture in one currency, under IFRS Accounting Standards: IAS 28 as currently issued, IFRS 11, IFRS 12 and IFRS 5. The IASB’s revised IAS 28 (Equity Method project) has not been issued and is not reflected; nor are the deferred 2014 amendments on sales or contributions of assets. Simplifications and limitations are set out in the Instructions tab.
Consolidating subsidiaries as well? Use it with the free Consolidation template. Testing the investment for impairment in more depth? See the CGU impairment template.
Designed for finance teams, auditors and advisers preparing or reviewing IFRS financial statements. It is a working aid: it does not replace the Standards or professional judgement.
