Global Standards for the world economy

Tuesday 23 July 2019

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Definition of a business


Definition of a Business and Accounting for Previously Held Interests (Amendments to IFRS 3 and IFRS 11)


The International Accounting Standards Board (the Board) published for public consultation Definition of a business and accounting for previously held interests (proposed amendments to IFRS 3 Business Combinations and IFRS 11 Joint Arrangements). It clarifies both the definition of a business and how to account for previously held interests.

The proposed amendments provide:

  • clearer application guidance to help distinguish between a business and a group of assets when applying IFRS 3; and
  • clarification on how an entityshould account for previously held interest in a business, if acquiring control, or joint control, of that business.

The proposed amended application guidance on the definition of a business in IFRS 3 arises from the Board’s Post-implementation Review (PIR) process, which is conducted on each Standard and major amendment approximately two years after their effective dates. The IFRS 3 PIR shows general support for the accounting requirements in the Standard but identifies some areas where further research will be undertaken. The full PIR of IFRS 3 is available here. Further information on the definition of a business project can be found here.

The proposed amendment to accounting for previously held interests was developed through the IFRS Interpretations Committee. Further information on this project can be found here.


Document
Exposure Draft: Definition of a Business and Accounting for Previously Held Interests
(Amendments to IFRS 3 and IFRS 11)
 
[PDF]
事業の定義及び従来保有していた持分の会計処理 IFRS第3号及びIFRS第11号の修正案 [PDF]
Proyecto de Norma: Definición de un Negocio y Contabilización de Participaciones Mantenidas Anteriormente
(Modificaciones propuestas a las NIIF 3 y NIIF 11)
[PDF]
Exposé-sondage: Définition d’une entreprise et comptabilisation des intérêts détenus antérieurement (projet de modification d’IFRS 3 et d’IFRS 11) [PDF]

 

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Contact

Jawaid Dossani
Senior Technical Manager
email: jdossani@ifrs.org