Joint arrangements: What’s new under IFRS 11?”,

Abstract In May 2011, the International Accounting Standards Board (IASB) issued a set of new International Financial Reporting Standards (IFRS) which are effective for annual periods beginning on or after 1 January 2013: (i) IFRS 10 - Consolidated Financial Statements, (ii) IFRS 11 - Joint Arrangements and (iii) IFRS 12 - Disclosure of Interests in Other Entities. The European Union (Regulation No 1254/2012) endorsed these standards and it has established that each company shall apply them, at the latest, as from the commencement date of its first financial year starting on or after 1 January 2014. In particular, this paper focus the attention on the new requirements established by IFRS 11. This new standard supersedes IAS 31 - Interests in Joint Ventures and SIC-13 Jointly Controlled Entities – Non-Monetary Contributions by Venturers, in order to arrive at an accounting treatment which accurately reflects the true nature of the economic interest held by parties to a joint arrangement. By issuing IFRS 11, the IASB introduced an overhaul of the existing accounting for joint arrangements. In this regard, Management should carefully evaluate the new requirements, as they may have a significant impact on how an entity can present its income statement and balance sheet. This paper - that is a part of a bigger project - aims to analyse the new criteria established under IFRS 11 and to highlight what are, at this stage, the main “critical points” that companies will face by applying the new standard