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(f)
(g)
(h)
December 31 60 73
Associates (h)
January 1 67 44
Acquisitions/(disposals) -- 22
Dividends received/reductions (32) (22)
Share in net profit 4 6
Currency retranslation 3 (14)
42 36
Of which: Net liabilities of JohnsonDiversey reclassified to provisions -- 31
December 31 42 67
Our principal joint ventures are Unilever Jerónimo Martins in Portugal, Pepsi/Lipton International and the Pepsi/Lipton Partnership in the United
States.
A reduction of €110 million in carrying value of Pepsi/Lipton International was recorded in relation to the extension of the Pepsi/Lipton joint venture
for ready-to-drink tea in January 2008.
Associates as at December 31, 2009, primarily comprise our investment in Langholm Capital Partners. Other Unilever Ventures assets (excluding
Langholm) are included under Other noncurrent financial assets above.
Interests in associates and joint ventures
BARLOWORLD Annual Report, 2009
The consolidated financial statements incorporate the assets, liabilities, income, and expenses of associates and joint ventures using the equity method of
accounting, applying the group’s accounting policies, from the acquisition date to the disposal date (except when the investment is classified as held-for-sale, in
which case it is accounted for as a Noncurrent Asset Held For Sale ). The most recent audited annual financial statements of associates and joint ventures are
used, which are all within three months of the year-end of the group. Adjustments are made to the associate’s or joint venture’s financial results for material
transactions and events in the intervening period. Losses of associates and joint ventures in excess of the group’s interest are not recognized unless there is a
binding obligation to contribute to the losses.
Goodwill arising on the acquisition of associates and joint ventures is included in the carrying amount of the associate and accounted for in accordance with the
accounting policy for goodwill as set out in note 17 below with the exception of impairment testing which is done in accordance with note 35 below and not
done separately from the investment.
Where a group entity transacts with an associate or a jointly controlled entity of the group, unrealized profits and losses are eliminated to the extent of the
group’s interest in the relevant associate or jointly controlled entity.
MULTIPLE-CHOICE QUESTIONS
1. An entity has bought a 25% share in another entity with a view to selling that investment within six months. The investment has been classified as held-for-sale in
accordance with IFRS 5. How should the investment be treated in the final year accounts?
a. It should be equity accounted.
b. The assets and liabilities should be presented separately from other assets in the statement of financial position under IFRS 5.
c. The investment should be dealt with under IAS 29.
d. Purchase accounting should be used for this investment.
2. The Standard does not require the equity method to be applied when the associate has been acquired and held with a view to its disposal within a certain time
period. What is the period within which the associate must be disposed of?
a. Six months.
b. Twelve months.
c. Two years.