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Both U.S. GAAP and IFRS require companies to use the equity method of accounting for joint ventures. However, until, IFRS allowed for an alternative accounting
Both U.S. GAAP and IFRS require companies to use the equity method of accounting for joint ventures. However, until, IFRS allowed for an alternative accounting method called proportionate consolidation. Under the proportionate consolidation method, the investor includes in its financial statements its shares of the joint-venture assets, liabilities, revenue, and expenses rather than the net amounts on the balance sheet and income statement.
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