Joint ventures -consolidate or treat as investments under IFRS?

Question

We have a joint venture where we own 50% of shares in a company. Should we consolidate it in our accounts or treat it as an investment?

Answer 1

According to IAS 28, Investment in Joint venture should be consolidated in financial statements of the Investor using Equity Method.

As per equity method,  on initial recognition the investment in a joint venture is recognized at cost, and the carrying amount is increased or decreased to recognize the investor’s share of the profit or loss of the investee after the date of acquisition. The investor’s share of the investee's  profit or loss is recognized in the investor’s profit or loss.