New suite of consolidation and related standards
(IFRS 10, 11 and 12)
How will the real estate sector be affected?
On 12 May 2011 the IASB issued its new suite of consolidation and related standards replacing the existing accounting for subsidiaries and joint ventures (now joint arrangements), and making limited amendments in relation to associates.
Key features of the new standards are:
- Changes to the definition of control (IFRS 10);
- Removal of option of proportionate consolidation for joint ventures (IFRS 11); and
- Extended and new disclosure requirements for interests in other entities (IFRS 12)
(Click on the links above for full KPMG publications)
The new standards are expected to have major accounting impact for real estate companies, asset managers and joint ventures. In our next issue of the Real Estate newsletter due to be published this summer, we will look at different structures common in the sector and provide an illustrative guidance on how the standards could affect them.
The new IFRSs will be effective for annual periods beginning on or after 1 January 2013.