IFRS 10

IFRS 10 establishes principles for presenting and preparing consolidated financial statements when an entity controls one or more other entities. IFRS 10:

  • requires an entity (the parent) that controls one or more other entities (subsidiaries) to present consolidated financial statements;
  • defines the principle of control, and establishes control as the basis for consolidation;
  • sets out how to apply the principle of control to identify whether an investor controls an investee and therefore must consolidate the investee;
  • sets out the accounting requirements for the preparation of consolidated financial statements; and
  • defines an investment entity and sets out an exception to consolidating particular subsidiaries of an investment entity.

Consolidated financial statements are financial statements that present the assets, liabilities, equity, income, expenses, and cash flows of a parent and its subsidiaries as those of a single economic entity.

What is the purpose of IFRS 10?

The objective of IFRS 10 as set out in the standard is to establish principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities.

What is control according to IFRS 10?


Control exists under IFRS 10 when the investor has power, exposure to variable returns and the ability to use that power to affect its returns from the investee. … IFRS 10 is the major output of the consolidation project, resulting in a single definition of control for all entities.

What is the difference between IFRS 3 and IFRS 10?


What is the difference between IFRS 3 and IFRS 10? … But while IFRS 10 defines control and prescribes specific consolidation procedures, IFRS 3 is more about the measurement of the items in the consolidated financial statements, such as goodwill, non-controlling interest, etc.

Is IFRS 10 an accounting standard?

An entity may apply IFRS 10 to an earlier accounting period, but if doing so it must disclose the fact that it has early adopted the standard and also apply: IFRS 11 Joint Arrangements. IFRS 12 Disclosure of Interests in Other Entities. … IAS 28 Investments in Associates and Joint Ventures (as amended in 2011).