# ASC 323-932-25: Investments—Equity Method and Joint Ventures — Extractive Activities—Oil and Gas — 25 Recognition

Source: FASB Accounting Standards Codification, Basic View

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## ASC 323-932-25: 25 Recognition

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##### [323-932-25-1](https://asc.understandingaccounting.org/asc/323/932/#323-932-25-1)

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Joint interest (also referred to as joint venture) operations result from an agreement among two or more working interest owners whereby one party is designated as the operator for the development and operation of the jointly owned property included in the joint venture. In joint interest operations, each working interest owner retains an undivided interest in the jointly operated property. This direct ownership is usually included in the financial statements of the investor through direct inclusion of its proportional share of the expenses, revenues, and assets. Joint interest operations are designed to accomplish the objectives of sharing risk, obtaining capital, maximizing efficiency of development and operations, and enhancing the recovery of reserves.

##### [323-932-25-2](https://asc.understandingaccounting.org/asc/323/932/#323-932-25-2)

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See Subtopic 932-810 for proportional consolidation.