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Which of the following is the BEST characterisation of the difference between a joint operation and a joint venture under Ind AS 111?
AJoint operations apply equity method; joint ventures apply line-by-line consolidation
BJoint operations are 50:50; joint ventures have other ownership splits
CJoint operations are listed entities; joint ventures are private
DJoint operators have rights to the assets and obligations for the liabilities; joint venturers have rights only to the net assets of the arrangement
Answer & Solution
Correct answer: D. Joint operators have rights to the assets and obligations for the liabilities; joint venturers have rights only to the net assets of the arrangement
The rights-and-obligations test is decisive — operators recognise their share of assets, liabilities, revenues and expenses; venturers apply equity method on a single line for their share of net assets. Voting splits, listing status and shorthand mappings between models do not classify the arrangement.
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