CERTYNEX IFRS ACADEMY

When a joint arrangement is structured through a separate vehicle, on what do the parties base its classification as a joint operation or a joint venture?

The legal form of the vehicle, which prevails even if the terms of the arrangement or other facts lead to another conclusion on the actual rights and obligations of the parties to the joint arrangement.

The percentage of capital held by each party in the vehicle, set against the size of the financial commitments it has made to it.

The parties' initial intention, as it appears from the project presentation documents given to their shareholders and funders.

The legal form, the terms of the arrangement and, when relevant, other facts and circumstances.