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if a CO injects cash in a JV owned by the same owners,balance classified as liability or equity in the JV


if a related party injects cash in a Joint Venture owned by the same owners of the Related Party,balance classified as liability or equity in the JV books? and what is the criteria?

asked Feb 13, 2016 in IAS 24 - Related Party Disclosures by anonymous

1 Answer

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Best answer
Well this depends on upon the nature of the transaction. If the related party has injected cash as a loan, it shall be reflected as a liability. However, if the JV has issued equity shares against the receipt of cash, the amount shall be classified as equity in the books of JV.
answered Dec 12, 2016 by Mian Musawar Level 3 Member (7,160 points)
selected Dec 15, 2016 by umar1621


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