I have a question about reporting an investment in a joint venture.
The venturer is a limited company that is applying FRSSE and therefore is exempt from FRS 9. However, they will be receiving shares in the joint venture entity (50% of the shares in the joint venture entity) in exchange for Intellectual Property that has already been written off in the venturer's accounts.
My question is - does the venturer have to disclose this investment in their abbreviated accounts, and if so where? If the investment should be included on the balance sheet as a fixed asset investment then, considering that no cash is being paid, what should be credited as part of the double entry?It strikes me that the most informative approach to reporting and disclosure is often the best.
This does not lend itself to the preparer asking questions such as 'do we have to disclose' but rather 'how do we best inform the reader about our business activities'. Asking this question would lead to disclosure of the business arrangement even if, because of the zero cost, this was only in the notes to the accounts.
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