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FEE agrees with the first two proposed amendments on the clarification on paragraph 4(a) of IFRS 10 and on the clarification on the exception when the subsidiary entity that provides investment-related services is itself an investment entity.
However, FEE does not agree with the different treatment for investment in associates as compared to investment in joint ventures as introduced in the proposed amendments.
From a practical standpoint, a joint venturer is also likely to face significant practical difficulties if it had to restate the financial statements of the joint venture in order to consolidate subsidiaries accounted for at fair value under the investment entities consolidation exception. Further a difference in the application of the equity method to associates and to joint ventures is not desirable. Accordingly, FEE strongly suggests that the exception for investment in associates should apply also to investments in joint ventures.