# ASC 323-946: Investments—Equity Method and Joint Ventures — Financial Services—Investment Companies Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/323/946/) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-09T23:42:12.104Z to 2026-09-09T23:42:31.673Z Record version: sha256:4efa9a0d29ed9e514925c9d765aa022b9619545b965168c2205982d0f650d1f9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-946: Investments—Equity Method and Joint Ventures — Financial Services—Investment Companies ### Machine-generated study aids ```json { "summary": "This subtopic tells investment companies how (and whether) to apply the equity method of Topic 323. The general rule is that an investment company does not use the equity method for its noncontrolling ownership interests; instead it measures those investments at fair value under Subtopic 946-320. The one exception is an investment in an operating entity that provides services to the investment company (e.g., an investment adviser or transfer agent), which is accounted for under the equity method if it otherwise qualifies.", "key_points": [ "This Subtopic addresses application of the Topic 323 equity method by an investment company (323-946-05-1) and follows the scope of Section 946-10-15 (323-946-15-1).", "Use of the equity method by an investment company generally is not appropriate; noncontrolling ownership interests are measured under Subtopic 946-320, which requires debt and equity securities to be subsequently measured at fair value (323-946-45-1).", "Exception: if the investment is in an operating entity that provides services to the investment company (for example, an investment adviser or transfer agent, see 946-10-55-5), the purpose is to obtain services rather than realize a gain on sale (323-946-45-2).", "For such a service-providing operating entity, a noncontrolling interest that otherwise qualifies for the equity method must be accounted for under the equity method rather than at fair value (323-946-45-2).", "Most of the former guidance in this subtopic (paragraphs 45-3 through 45-18, 50-1 through 50-4, and 55-1 through 55-9) was superseded by ASU 2013-08." ], "categories": [ "Subsequent measurement", "Fair value", "Industry-specific", "Financial instruments" ], "audience_level": "intermediate", "student_note": "The takeaway is a flip of the normal Topic 323 default: significant influence does not trigger the equity method for an investment company, because fair value measurement is the industry's overriding measurement principle. The common mistake is missing the narrow exception for investments in service providers (adviser, transfer agent), where the equity method is required, not optional.", "related_topics": [ "323", "946-320", "946-10", "946-810", "820" ], "key_concepts": [ "investment company", "equity method", "fair value measurement", "noncontrolling ownership interest", "operating entity providing services", "investment adviser", "transfer agent" ] } ``` Source downloaded (UTC): 2026-09-09T23:42:12.104Z to 2026-09-09T23:42:12.104Z Record version: sha256:f257828f3a7b7b4cc119537c7d43543d71a65a6718efeec2eb3914a64999ff4e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-946-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/323/946/#00-status) SEC content: no ##### [323-946-00-1](https://asc.understandingaccounting.org/asc/323/946/#323-946-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:12.104Z to 2026-09-09T23:42:12.104Z Record version: sha256:6bf98c0f581caad1134296018237de9487f6c34521f1f7d58c3497deb514706d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Investment CompanySupersededAccounting Standards Update No. 2013-0806/07/2013
Related PartiesSupersededAccounting Standards Update No. 2013-0806/07/2013
UnderlyingSupersededAccounting Standards Update No. 2013-0806/07/2013
946-323-05-1AmendedAccounting Standards Update No. 2013-0806/07/2013
946-323-15-1AmendedAccounting Standards Update No. 2013-0806/07/2013
946-323-15-2SupersededAccounting Standards Update No. 2013-0806/07/2013
946-323-45-1AmendedAccounting Standards Update No. 2013-0806/07/2013
946-323-45-2AmendedAccounting Standards Update No. 2013-0806/07/2013
946-323-45-3 through 45-18SupersededAccounting Standards Update No. 2013-0806/07/2013
946-323-50-1 through 50-4SupersededAccounting Standards Update No. 2013-0806/07/2013
946-323-55-1 through 55-9SupersededAccounting Standards Update No. 2013-0806/07/2013
Source downloaded (UTC): 2026-09-09T23:42:15.242Z to 2026-09-09T23:42:15.242Z Record version: sha256:a13de4c28dac2641288a08499e974007b6a4e0e6be9739771d9f1b5d5bd6ccf5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-946-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/323/946/#05-overview-and-background) SEC content: no ##### [323-946-05-1](https://asc.understandingaccounting.org/asc/323/946/#323-946-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:15.242Z to 2026-09-09T23:42:15.242Z Record version: sha256:3d308d6fea140cf34cded948b5faf7907b5c26f80ea039e85cc78e89d30afd51 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides guidance on the application of the equity method of accounting in Topic 323 by an investment company. Source downloaded (UTC): 2026-09-09T23:42:17.010Z to 2026-09-09T23:42:17.010Z Record version: sha256:715bfaf1fef8fb9e18a8328bf79506ded86ce52303ba1d18b10630b563902a5e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-946-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/323/946/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [323-946-15-1](https://asc.understandingaccounting.org/asc/323/946/#323-946-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:17.010Z to 2026-09-09T23:42:17.010Z Record version: sha256:14b0ea950935495cd44c4531c642d5a782733e29f6e5fdce92a670edacd5eeb8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 946-10-15. ##### [323-946-15-2](https://asc.understandingaccounting.org/asc/323/946/#323-946-15-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:17.010Z to 2026-09-09T23:42:17.010Z Record version: sha256:743df043f0eed554cc282fc5de7f9965b230682a8cd8bfa9de0fbdedcf41e792 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2013-08](https://asc.understandingaccounting.org/updates/asu-2013-08/). Source downloaded (UTC): 2026-09-09T23:42:21.740Z to 2026-09-09T23:42:21.740Z Record version: sha256:c071d2c854f6e9edb8460c520ec0a63f85739d2daa2fa702ee102bf182f831bb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-946-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/323/946/#45-other-presentation-matters) SEC content: no #### Application of the Equity Method ##### [323-946-45-1](https://asc.understandingaccounting.org/asc/323/946/#323-946-45-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:21.740Z to 2026-09-09T23:42:21.740Z Record version: sha256:c9d94cfd6125ec860fa87c7fa6c31ac30b7965206072cb40de4d691aec3da890 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Except as discussed in the following paragraph, use of the equity method of accounting by an investment company is not appropriate. Rather, those noncontrolling ownership interests held by an investment company shall be measured in accordance with guidance in Subtopic 946-320, which requires investments in debt and equity securities to be subsequently measured at [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date."). ##### [323-946-45-2](https://asc.understandingaccounting.org/asc/323/946/#323-946-45-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:21.740Z to 2026-09-09T23:42:21.740Z Record version: sha256:10e8e81febea91ff4441f6a884ddde0b02fb396546b80a04f3e2846f5782da41 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An exception to the general principle in the preceding paragraph occurs if the investment company has an investment in an operating entity that provides services to the investment company, for example, an investment adviser or transfer agent (see paragraph [946-10-55-5](https://asc.understandingaccounting.org/asc/946/10/#946-10-55-5)). In those cases, the purpose of the investment is to provide services to the investment company rather than to realize a gain on the sale of the investment. If an investment company holds a noncontrolling ownership interest in such an operating entity that otherwise qualifies for use of the equity method of accounting, the investment company should use the equity method of accounting for that investment, rather than measuring the investment at fair value. ##### [323-946-45-3](https://asc.understandingaccounting.org/asc/323/946/#323-946-45-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:21.740Z to 2026-09-09T23:42:21.740Z Record version: sha256:60a73a510798afe02479d8bd7d7f28ae90894e9c04f0e12cd2b893ba5b794d0f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraphs 946-323-45-3 through 45-18 superseded by Accounting Standards Update No. 2013-08](https://asc.understandingaccounting.org/asc/323/946/#323-946-45-3). Source downloaded (UTC): 2026-09-09T23:42:25.281Z to 2026-09-09T23:42:25.281Z Record version: sha256:a73d2ad9f4b4da62a6b65402e0826ee5789feffbfe1b2c1eafeec439ca9a170c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-946-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/323/946/#50-disclosure) SEC content: no ##### [323-946-50-1](https://asc.understandingaccounting.org/asc/323/946/#323-946-50-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:25.281Z to 2026-09-09T23:42:25.281Z Record version: sha256:ad6f40aeb8650f5941db2e61ef97b71817375d63df409941e41ac758aec55f6b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraphs 946-323-50-1 through 50-4 superseded by Accounting Standards Update No. 2013-08](https://asc.understandingaccounting.org/asc/323/946/#323-946-50-1). Source downloaded (UTC): 2026-09-09T23:42:29.068Z to 2026-09-09T23:42:29.068Z Record version: sha256:e8bd077961be11855aff7aa12f714c388b455176bf0f64569977f97f240e9b7f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-946-55: 55 Implementation Guidance and Illustrations [Read section](https://asc.understandingaccounting.org/asc/323/946/#55-implementation-guidance-and-illustrations) SEC content: no ##### [323-946-55-1](https://asc.understandingaccounting.org/asc/323/946/#323-946-55-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:29.068Z to 2026-09-09T23:42:29.068Z Record version: sha256:443998c75b5fb332921cac580a67829426fddb8e8b14547cb4064408b9fbc663 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraphs 946-323-55-1 through 55-9 superseded by Accounting Standards Update No. 2013-08](https://asc.understandingaccounting.org/asc/323/946/#323-946-55-1). Source downloaded (UTC): 2026-09-09T23:42:31.673Z to 2026-09-09T23:42:31.673Z Record version: sha256:26615b9eccf6a960ccaf1cb5a64cc61326f5e0889e58530646ff2ea112109882 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-946-65: 65 Transition and Open Effective Date Information [Read section](https://asc.understandingaccounting.org/asc/323/946/#65-transition-and-open-effective-date-information) SEC content: no ##### [323-946-65-1](https://asc.understandingaccounting.org/asc/323/946/#323-946-65-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:31.673Z to 2026-09-09T23:42:31.673Z Record version: sha256:abcc6847a3813f56d344b600ced35bd7a2decd9392c4445c51ae9ea3a7b14230 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph not used](https://asc.understandingaccounting.org/updates/page-1833002/).