# ASC 323-30-35: Investments—Equity Method and Joint Ventures — Partnerships, Joint Ventures, and Limited Liability Entities — 35 Subsequent Measurement

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/323/30/#35-subsequent-measurement)

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## ASC 323-30-35: 35 Subsequent Measurement

[Read section](https://asc.understandingaccounting.org/asc/323/30/#35-subsequent-measurement)

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#### Partnership Profits and Losses

##### [323-30-35-1](https://asc.understandingaccounting.org/asc/323/30/#323-30-35-1)

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Partnership profits and losses accrued by investor-partners generally shall be reflected in their financial statements as described in paragraphs

[323-10-45-1 through 45-2](https://asc.understandingaccounting.org/asc/323/10/#323-10-45-1)

, respectively.

##### [323-30-35-2](https://asc.understandingaccounting.org/asc/323/30/#323-30-35-2)

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Likewise, most of the other provisions of Section 323-10-35 would be appropriate in accounting for a partnership interest, such as the elimination of intra-entity profits and losses (see paragraph [323-10-35-7](https://asc.understandingaccounting.org/asc/323/10/#323-10-35-7)). However, income taxes shall be provided on the profits accrued by investor-partners regardless of the tax basis employed in the partnership return. The tax liabilities applicable to partnership interests relate directly to the partners, and the accounting for income taxes generally contemplated by Topic 740 is appropriate.

#### Investment in a Limited Liability Company

##### [323-30-35-3](https://asc.understandingaccounting.org/asc/323/30/#323-30-35-3)

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An investment in a limited liability company that maintains a specific ownership account for each investor—similar to a partnership capital account structure—shall be viewed as similar to an investment in a limited partnership for purposes of determining whether a noncontrolling investment in a limited liability company shall be accounted for in accordance with the guidance in Topic 321 or the equity method.

#### Discontinuance of the Equity Method

##### [323-30-35-4](https://asc.understandingaccounting.org/asc/323/30/#323-30-35-4)

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Paragraph [323-10-35-39](https://asc.understandingaccounting.org/asc/323/10/#323-10-35-39) provides guidance on discontinuance of the equity method for a limited partnership because the conditions in paragraph [970-323-25-6](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-6) are met.