• Jointly controlled assets – the
venturers jointly control an asset
dedicated to be used within the joint
venture rather than establishing a
separate entity.
• Jointly controlled entities – this
involves the establishment of a
separate entity in which each
venturer has an interest.
Jointly controlled operations
It is rare for a jointly controlled operation
to have its own financial statements. The
individual financial statements of each
individual venturer will recognise:
• theassetsthatitcontrolsandthe
liabilities that it incurs
• theexpensesthatitincursand
its share of the revenue that it earns
from the sale of goods or services by
the joint venture.
Jointly controlled assets
It is unlikely that there is a full set of
accounts for this type of joint venture so
the individual venturers will set up a joint
venture account in their own records for the
income and expenses incurred in respect
of the joint venture and a memorandum
income statement is prepared periodically
to calculate the amount payable to or
receivable from the other venturers.
Jointly controlled entities
A jointly controlled entity keeps its own
accounting records.
In the individual financial statements of the
venturers, the investment in the joint venture
is recorded at cost. In the consolidated
financial statements, IAS 31 gives a choice
of treatment:
Proportionate consolidation• – the
venturer includes its share of the assets,