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Wednesday 11 December 2019

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Draft Interpretation

Put options written on non-controlling interests (Proposed amendments to IAS 32)

Draft Interpretation and Comment letters

The IFRS Interpretations Committee, responsible, in co-operation with the IASB, for developing amendments and Interpretations of International Financial Reporting Standards (IFRSs), has today published for public comment proposed guidance on the accounting for a put option written by a parent entity on the shares of its subsidiary held by a non-controlling-interest shareholder. A put option is a contract that gives the holder of the option the right to sell a specified asset to the writer of the option at a specified price within a specified time.

If a parent entity is obliged to purchase the shares of its subsidiary for cash or for another financial asset, the parent must recognise a financial liability in its consolidated financial statements for the present value of the option exercise price. The Interpretations Committee was asked to consider how to subsequently measure that financial liability, because diversity exists in practice.

In response to that request, the Interpretations Committee has proposed that all changes in the measurement of that financial liability should be recognised in profit or loss in accordance with IAS 39 Financial Instruments: Recognition and Measurement and IFRS 9 Financial Instruments.

Comment letter deadline


The draft Interpretation commenting period closed on 1 October 2012.

Please note: when submitting a comment letter or when communicating with the IFRS Foundation, the IASB or any of its constituent bodies, you acknowledge and accept the IFRS Foundation Written Communication policy which details how we use and process your data.

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View the draft Interpretation Comment letters.

Due process document
Draft Interpretation: Put Options Written on Non-controlling Interests [English] [PDF]
Projet d’interprétation IFRIC: Options de vente consenties aux actionnaires sans contrôle [French] [PDF]


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