Chrysler 2015 Annual Report Download - page 144

144 2015 | ANNUAL REPORT
Consolidated
Financial Statements
Notes to the Consolidated
Financial Statements
Subsidiaries are deconsolidated from the date which control ceases. When the Group ceases to have control over a
subsidiary, it de-recognizes the assets (including any goodwill) and liabilities of the subsidiary at their carrying amounts,
de-recognizes the carrying amount of non-controlling interests in the former subsidiary and recognizes the fair value of
any consideration received from the transaction. Any retained interest in the former subsidiary is then remeasured to
its fair value.
All intra-group balances and transactions and any unrealized gains and losses arising from intra-group transactions
are eliminated in preparing the Consolidated Financial Statements.
Interests in Joint Ventures and Associates
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the
net assets of the arrangement.
An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in
the financial and operating policy decisions of the investees but does not have control or joint control over those policies.
Joint ventures and associates are accounted for using the equity method of accounting from the date joint control
and significant influence is obtained. On acquisition of the investment, any excess of the cost of the investment and
the Group’s share of the net fair value of the investee’s identifiable assets and liabilities is recognized as goodwill
and is included in the carrying amount of the investment. Any excess of the Group’s share of the net fair value of the
investee’s identifiable assets and liabilities over the cost of the investment is included as income in the determination of
the Group’s share of the investee’s profit or loss in the acquisition period.
Under the equity method, the investments are initially recognized at cost and adjusted thereafter to recognize the
Group’s share of the profit/(loss) and other comprehensive income/(loss) of the investee. The Group’s share of the
investee’s profit/(loss) is recognized in the Consolidated Income Statement. Distributions received from an investee
reduce the carrying amount of the investment. Post-acquisition movements in Other comprehensive income/(loss)
are recognized in Other comprehensive income/(loss) with a corresponding adjustment to the carrying amount of
the investment.
Unrealized gains on transactions between the Group and its joint ventures and associates are eliminated to the extent
of the Group’s interest in the joint venture or associate. Unrealized losses are also eliminated unless the transaction
provides evidence of an impairment of the asset transferred.
When the Group’s share of the losses of a joint venture or associate exceeds the Group’s interest in that joint venture
or associate, the Group discontinues recognizing its share of further losses. Additional losses are provided for, and
a liability is recognized, only to the extent that the Group has incurred legal or constructive obligations or made
payments on behalf of the joint venture or associate.
The Group discontinues the use of the equity method from the date the investment ceases to be an associate or a
joint venture, or when it is classified as available-for-sale.
Interests in Joint Operations
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to
the assets and obligations for the liabilities relating to the arrangement. Joint control is the contractually agreed sharing
of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous
consent of the parties sharing control.
When the Group undertakes its activities under joint operations, it recognizes its related interest in the joint operation
including: (i)its assets, including its share of any assets held jointly, (ii)its liabilities, including its share of any liabilities
incurred jointly, (iii)its revenue from the sale of its share of the output arising from the joint operation (iv)its share of
the revenue from the sale of the output by the joint operation and (v)its expenses, including its share of any expenses
incurred jointly.