IFRS 12 Objective and Scope

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Last update 03/02/2020

Objective

1 The objective of this IFRS is to require an entity to disclose information that enables users of its financial statements to evaluate: the nature of, and risks associated with, its interests in other entities; and the effects of those interests on its financial position, financial performance and cash flows.

Meeting the objective

2 To meet the objective in paragraph 1, an entity shall disclose:

  1. the significant judgements and assumptions it has made in determining:
    1. the nature of its interest in another entity or arrangement;
    2. the type of joint arrangement in which it has an interest (paragraphs 7–9);
    3. that it meets the definition of an investment entity, if applicable (paragraph 9A); and
  2. information about its interests in:
    1. subsidiaries (paragraphs 10–19);
    2. joint arrangements and associates (paragraphs 20–23); and
    3. structured entities that are not controlled by the entity (unconsolidated structured entities) (paragraphs 24–31).

3 If the disclosures required by this IFRS, together with disclosures required by other IFRSs, do not meet the objective in paragraph 1, an entity shall disclose whatever additional information is necessary to meet that objective.

4 An entity shall consider the level of detail necessary to satisfy the disclosure objective and how much emphasis to place on each of the requirements in this IFRS. It shall aggregate or disaggregate disclosures so that useful information is not obscured by either the inclusion of a large amount of insignificant detail or the aggregation of items that have different characteristics (see paragraphs B2–B6).

Scope

5 This IFRS shall be applied by an entity that has an interest in any of the following:

  1. subsidiaries
  2. joint arrangements (ie joint operations or joint ventures)
  3. associates
  4. unconsolidated structured entities.

5A Except as described in paragraph B17, the requirements in this IFRS apply to an entity’s interests listed in paragraph 5 that are classified (or included in a disposal group that is classified) as held for sale or discontinued operations in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations.

6 This IFRS does not apply to:

  1. post-employment benefit plans or other long-term employee benefit plans to which IAS 19 Employee Benefits applies.
  2. an entity’s separate financial statements to which IAS 27 Separate Financial Statements applies. However:
    1. if an entity has interests in unconsolidated structured entities and prepares separate financial statements as its only financial statements, it shall apply the requirements in paragraphs 24–31 when preparing those separate financial statements.
    2. an investment entity that prepares financial statements in which all of its subsidiaries are measured at fair value through profit or loss in accordance with paragraph 31 of IFRS 10 shall present the disclosures relating to investment entities required by this IFRS.
  3. an interest held by an entity that participates in, but does not have joint control of, a joint arrangement unless that interest results in significant influence over the arrangement or is an interest in a structured entity.
  4. an interest in another entity that is accounted for in accordance with IFRS 9 Financial Instruments. However, an entity shall apply this IFRS:
    1. when that interest is an interest in an associate or a joint venture that, in accordance with IAS 28 Investments in Associates and Joint Ventures, is measured at fair value through profit or loss; or
    2. when that interest is an interest in an unconsolidated structured entity.