CERTYNEX IFRS ACADEMY

Alba SA holds 30% of Brise SA, an associate accounted for under the equity method. Under a new contractual agreement, Alba and another shareholder now exercise joint control over Brise, which becomes a joint venture (facts of the case). How does Alba treat its interest at the date of the change?

It continues to apply the equity method and does not remeasure the retained interest.

It discontinues the equity method and remeasures its interest at fair value, with a gain or loss in profit or loss at the date of the change.

It discontinues the equity method and accounts for its interest as a financial asset measured under IFRS 9 from that date.

It continues the equity method but remeasures the retained interest at fair value so as to include the goodwill of the joint venture.