Acquiring an interest in a joint operation

Learning objectives

• Analyse whether the joint operation acquired constitutes a business and, if so, which principles of IFRS 3 apply to the acquisition of the interest.L3

Normative references

• IFRS 11 §21AWhen an entity acquires an interest in a joint operation whose activity constitutes a business as defined in IFRS 3, it applies, to the extent of its share in accordance with para. 20, all of the principles on business combinations accounting in IFRS 3 and other IFRSs that do not conflict with IFRS 11, and discloses the related information; this applies to the acquisition of both the initial interest and additional interests, as set out in B33A to B33D. Paragraph added in May 2014, applicable prospectively to annual periods beginning on or after 1 January 2016 (C1AA, C14A).

Original summaries of the paragraphs (reference register), never a quotation of the standard.

1 question

• Boréal SA acquires a 30% interest in a joint operation whose activity is a mine in production, with its inputs, processes and output; the analysis shows that it is a business within the meaning of IFRS 3 (case facts). What must Boréal apply to the acquisition of its interest?L3