# ASC 323-970: Investments—Equity Method and Joint Ventures — Real Estate—General Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/323/970/) 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): 2026-09-09T23:42:35.809Z to 2026-09-09T23:43:01.427Z Record version: sha256:42f9f5282f59bc0332154447990b59d2069d4c56e0b2d9fba678defb88a4a63b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970: Investments—Equity Method and Joint Ventures — Real Estate—General ### Machine-generated study aids ```json { "summary": "ASC 323-970 (also cited as 970-323) governs how an investor accounts for interests in real estate ventures—corporate joint ventures, general partnerships, limited partnerships, and undivided interests. The general rule is one-line equity method presentation for noncontrolling investors (pro rata consolidation is prohibited except under 810-10-45-14), consolidation principles if the investor controls the venture, and Topic 321 if the interest is so minor that the investor has virtually no influence. It also prescribes initial measurement of contributed cash or real estate (via Subtopic 610-20 / 360-10-40-3A through 40-3C), elimination of intra-entity profit, and rules for recognizing losses in excess of the investment.", "key_points": [ "Noncontrolling investors in real estate general partnerships, and generally limited partners, account for their investments under the equity method using Topic 323 as a guide (323-970-25-3; 25-6); an interest so minor that the investor has virtually no influence is accounted for under Topic 321 (323-970-25-6).", "The one-line equity method must be used in both the balance sheet and income statement; pro rata consolidation is not appropriate except in the limited circumstances in paragraph 810-10-45-14 (323-970-25-4), and undivided interests subject to joint control are presented like investments in noncontrolled partnerships (323-970-25-12).", "A controlling investor—including a limited partner controlling through kick-out rights under 810-10-15-8A—applies subsidiary/consolidation principles in Topic 810 rather than joint venture guidance (323-970-25-8; 25-10).", "Investors contributing cash record the investment at cash contributed (323-970-30-2); an investor contributing real estate records the investment at fair value when the real estate is derecognized, applying 360-10-40-3A through 40-3C and Subtopic 610-20, measuring the retained interest at fair value under 610-20-32-4 (323-970-30-3; 30-6).", "An investor may not record income for its equity in the venture's profit on a sale of real estate to that investor; that share reduces the carrying amount of the purchased real estate and is recognized as the asset is depreciated or sold to a third party (323-970-30-7), and intra-entity profit is eliminated in relation to the investor's noncontrolling interest, with full elimination if the investor controls the investee (323-970-35-14).", "Losses in excess of the investment (including loans and advances) must be recorded—and reported as a liability—if the investor is liable as guarantor or general partner or is otherwise committed to provide support, or when imminent return to profitable operations appears assured (323-970-35-3 through 35-6); if losses are not recognized, the equity method resumes only after subsequent income equals the unrecognized losses (323-970-35-7).", "Investors must absorb losses allocable to other investors when it is probable those investors cannot bear them, applying Subtopic 450-20 loss contingency principles (323-970-35-8; 35-10); profit and loss allocation ratios are ignored if cash and liquidating distributions are determined on another basis—substance governs (323-970-35-17)." ], "categories": [ "Recognition", "Initial measurement", "Subsequent measurement", "Consolidation" ], "audience_level": "intermediate", "student_note": "This subtopic is the classic exam trap for real estate partnerships: students often assume a limited partner or undivided-interest holder can report its pro rata share of assets and liabilities, but ASC 323-970-25-4 and 25-12 require one-line equity method presentation, and losses can exceed the investment (recorded as a liability) when the investor is a guarantor or general partner.", "related_topics": [ "323-10", "970-810", "610-20", "360-10", "810-10", "321-10" ], "key_concepts": [ "real estate venture", "equity method", "one-line presentation", "pro rata consolidation", "undivided interests", "losses in excess of investment", "intra-entity profit elimination", "contribution of real estate" ] } ``` Source downloaded (UTC): 2026-09-09T23:42:35.809Z to 2026-09-09T23:42:35.809Z Record version: sha256:474c8dc0afb1820a0d25f18c8576358e4023ad84d19281698236e3d2bfa2f90a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/323/970/#00-status) SEC content: no ##### [323-970-00-1](https://asc.understandingaccounting.org/asc/323/970/#323-970-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:35.809Z to 2026-09-09T23:42:35.809Z Record version: sha256:c15a103d20ebea462f6f61f170df1bc1dae11d8cca3bf8882031c52c5d4500e7 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
Corporate Joint VentureAmendedAccounting Standards Update No. 2010-0802/02/2010
Kick-Out Rights (Voting Interest Entity definition)AddedAccounting Standards Update No. 2015-0202/18/2015
Noncontrolling InterestAddedAccounting Standards Update No. 2017-0502/22/2017
970-323-05-4AmendedAccounting Standards Update No. 2025-1212/17/2025
970-323-15-2AmendedAccounting Standards Update No. 2012-0410/01/2012
970-323-25-5AmendedAccounting Standards Update No. 2015-0202/18/2015
970-323-25-6AmendedAccounting Standards Update No. 2016-0101/05/2016
970-323-25-7SupersededAccounting Standards Update No. 2016-0101/05/2016
970-323-25-8AmendedAccounting Standards Update No. 2016-0101/05/2016
970-323-25-8AmendedAccounting Standards Update No. 2015-0202/18/2015
970-323-25-8AmendedAccounting Standards Update No. 2009-0207/01/2009
970-323-25-11AmendedAccounting Standards Update No. 2016-0101/05/2016
970-323-25-11AmendedAccounting Standards Update No. 2010-0802/02/2010
970-323-30-3AmendedAccounting Standards Update No. 2017-0502/22/2017
970-323-30-3AmendedAccounting Standards Update No. 2014-0905/28/2014
970-323-30-4SupersededAccounting Standards Update No. 2017-0502/22/2017
970-323-30-4AmendedAccounting Standards Update No. 2014-0905/28/2014
970-323-30-5SupersededAccounting Standards Update No. 2017-0502/22/2017
970-323-30-6AmendedAccounting Standards Update No. 2017-0502/22/2017
970-323-30-6AmendedAccounting Standards Update No. 2014-0905/28/2014
970-323-35-14AmendedAccounting Standards Update No. 2017-0502/22/2017
970-323-35-15AmendedAccounting Standards Update No. 2017-0502/22/2017
970-323-40-1AmendedMaintenance Update 2021-02 (PDF)01/19/2021
970-323-40-1AmendedAccounting Standards Update No. 2017-0502/22/2017
970-323-40-1AmendedAccounting Standards Update No. 2014-0905/28/2014
Source downloaded (UTC): 2026-09-09T23:42:39.496Z to 2026-09-09T23:42:39.496Z Record version: sha256:d828ca2c540cdf8c26630141ec2191b60bba22f4b760f377b7f14ddbca585c3d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/323/970/#05-overview-and-background) SEC content: no ##### [323-970-05-1](https://asc.understandingaccounting.org/asc/323/970/#323-970-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:39.496Z to 2026-09-09T23:42:39.496Z Record version: sha256:372c7a0f0a74ff49e9df65e97c02666b5441c841c7dadcf7631dad4ab43f39a6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides accounting guidance on various forms of real estate ownership. In addition it addresses investor accounting for certain transactions with a [real estate venture](https://asc.understandingaccounting.org/glossary/r/#real-estate-venture "Any of the following: a joint venture, a general partnership, a limited partnership, and an undivided interest."). ##### [323-970-05-2](https://asc.understandingaccounting.org/asc/323/970/#323-970-05-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:39.496Z to 2026-09-09T23:42:39.496Z Record version: sha256:c4111e57ceae3e29c9ceb2b20518bd1a754848d8af5fd5c8402b640374d0d3dd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Ownership of real estate or real estate development projects by two or more entities may take several forms. The most common forms are a [corporate joint venture](https://asc.understandingaccounting.org/glossary/c/#corporate-joint-venture "A corporation owned and operated by a small group of entities (the joint venturers) as a separate and specific business or project for the mutual benefit of the members of the group. A government may also be a member of the group. The purpose of a corporate joint venture frequently is to share risks and rewards in developing a new market, product or technology; to combine complementary technological knowledge; or to pool resources in developing production or other facilities. A corporate joint venture also usually provides an arrangement under which each joint venturer may participate, directly or indirectly, in the overall management of the joint venture. Joint venturers thus have an interest or relationship other than as passive investors. An entity that is a subsidiary of one of the joint venturers is not a corporate joint venture. The ownership of a corporate joint venture seldom changes, and its stock is usually not traded publicly. A noncontrolling interest held by public ownership, however, does not preclude a corporation from being a corporate joint venture."), a [general partnership](https://asc.understandingaccounting.org/glossary/g/#general-partnership "An association in which each partner has unlimited liability."), a [limited partnership](https://asc.understandingaccounting.org/glossary/l/#limited-partnership "An association in which one or more general partners have unlimited liability and one or more partners have limited liability. A limited partnership is usually managed by the general partner or partners, subject to limitations, if any, imposed by the partnership agreement."), or an [undivided interest](https://asc.understandingaccounting.org/glossary/u/#undivided-interest "An ownership arrangement in which two or more parties jointly own property, and title is held individually to the extent of each party's interest."). ##### [323-970-05-3](https://asc.understandingaccounting.org/asc/323/970/#323-970-05-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:39.496Z to 2026-09-09T23:42:39.496Z Record version: sha256:6892ed221d5bf6014ddfce480af088adc678bdc6c04c57e73ca95475ecd401a8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In this Subtopic, the terms venture and real estate venture apply to all of these ownership arrangements described above. These forms of ownership differ in legal form and economic substance. ##### [323-970-05-4](https://asc.understandingaccounting.org/asc/323/970/#323-970-05-4) Pending content: yes Source downloaded (UTC): 2026-09-09T23:42:39.496Z to 2026-09-09T23:42:39.496Z Record version: sha256:d6b812d77b9081d4c9f592897c8479990b395c8d63086634585bd31a3b11eb20 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Subtopic 323-740 for guidance on accounting for qualified affordable housing investments. Transition date:(P) December 16, 2026; (N) December 16, 2026Transition guidance: [105-10-65-10](https://asc.understandingaccounting.org/asc/105/10/#105-10-65-10)See Subtopic 323-740 for guidance on the use of the proportional amortization method to investments made primarily for the purpose of receiving income tax credits and other income tax benefits. ##### [323-970-05-5](https://asc.understandingaccounting.org/asc/323/970/#323-970-05-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:39.496Z to 2026-09-09T23:42:39.496Z Record version: sha256:1613d7e26c0b1c70048f61c5ac24b9c04726044b72b978aaccc2d129885c25fd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The [Acquisition, Development, and Construction Subsection](https://asc.understandingaccounting.org/asc/310/10/#15-scope-and-scope-exceptions) of Section 310-10-15 addresses [acquisition, development, and construction arrangements](https://asc.understandingaccounting.org/glossary/a/#acquisition-development-and-construction-arrangements "Acquisition, development, or construction arrangements, in which a lender, usually a financial institution, participates in expected residual profit from the sale or refinancing of property.") in which the lender participates in expected residual profit. The [Acquisition, Development, and Construction Subsection](https://asc.understandingaccounting.org/asc/310/10/#25-recognition) of Section 310-10-25 provides criteria for distinguishing between such arrangements that shall be accounted for as loans or real estate joint ventures, and provides accounting guidance for circumstances in which such arrangements are required to be accounted for as real estate joint ventures. Source downloaded (UTC): 2026-09-09T23:42:43.078Z to 2026-09-09T23:42:43.078Z Record version: sha256:73377914e88d5067a1752aff77f12f4b2188b3e34c67b1605bbbe6187daf4cd7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/323/970/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [323-970-15-1](https://asc.understandingaccounting.org/asc/323/970/#323-970-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:43.078Z to 2026-09-09T23:42:43.078Z Record version: sha256:f2e65a0a2025ce4dfdeed8b45fe10e0beb91621bf16e391a81368277fec9097c 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 970-10-15, with specific entity exceptions noted below. #### Entities ##### [323-970-15-2](https://asc.understandingaccounting.org/asc/323/970/#323-970-15-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:43.078Z to 2026-09-09T23:42:43.078Z Record version: sha256:89c5e70f31518e9cc13175f1c67f0b868fc5ab6dd4d25168ef87773110547d73 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic does not apply to the following entities: 1. a Regulated investment entities and other entities that are required to account for investments at fair value. ##### [323-970-15-3](https://asc.understandingaccounting.org/asc/323/970/#323-970-15-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:43.078Z to 2026-09-09T23:42:43.078Z Record version: sha256:45200f7993f9718c171c30dff9012d92a78d7c954eeed0a645e081cc68721cfc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Sections 946-10-15 and 946-323-15 for applicability to unincorporated joint ventures and non-regulated investment entities. Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:e5d5789cab4deaf42e4cd5d0b7d1723b67f39928fa3ec450bae0c5bc7927d2ca Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/323/970/#25-recognition) SEC content: no ##### [323-970-25-1](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:895a9dcfa68515a85e7332a9719242be5227207982f2821e306b42c3060dab4c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph not used](https://asc.understandingaccounting.org/updates/page-1833002/). #### General Partnerships ##### [323-970-25-2](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:2ce708ad6258efb597da0553542531678657dbce7b7f8563f229069ddcb9c89c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraph [970-810-25-2](https://asc.understandingaccounting.org/asc/810/970/#810-970-25-2) states that a noncontrolling investor in a [general partnership](https://asc.understandingaccounting.org/glossary/g/#general-partnership "An association in which each partner has unlimited liability.") shall account for its investment by the equity method and should be guided by the provisions of Topic 323. ##### [323-970-25-3](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:3ad17f421ec9c797aa81dd9691fcb7504b19d7a2c4352c58a074e53b0d73b979 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Many provisions of Topic 323 are appropriate in accounting for investments in certain unincorporated entities. The principal difference, aside from income tax considerations, between corporate joint ventures and general partnerships is that the individual investors in general partnerships usually assume joint and several liability. The equity method, however, enables noncontrolling investors in general partnerships to reflect the underlying nature of their investments in those ventures as well as it does for investors in corporate joint ventures. Accordingly, investments in noncontrolled real estate general partnerships shall be accounted for and reported under the equity method. ##### [323-970-25-4](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:e3b292f44e1ce2c9e2e5ddb2f2bbb78b9841c3918f33fd385ef88b4680919836 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An entity shall apply the one-line equity method of presentation in both the balance sheet and the statement of income. Pro rata consolidation is not appropriate except in the limited circumstances described in paragraph [810-10-45-14](https://asc.understandingaccounting.org/asc/810/10/#810-10-45-14). Topic 323 shall be used as a guide in applying the equity method. #### Limited Partnerships ##### [323-970-25-5](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:55610b6deb026c059a27b12d583aa35fa580ab857053b80904012e467bc115ae Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For guidance on determining whether a general partner or a limited partner shall consolidate a [limited partnership](https://asc.understandingaccounting.org/glossary/l/#limited-partnership "An association in which one or more general partners have unlimited liability and one or more partners have limited liability. A limited partnership is usually managed by the general partner or partners, subject to limitations, if any, imposed by the partnership agreement.") or apply the equity method of accounting to its interests in the limited partnership, see paragraph [970-810-25-3](https://asc.understandingaccounting.org/asc/810/970/#810-970-25-3). ##### [323-970-25-6](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:be4a31a965249e427671d16f38e01d405aeb5b324b87aad548b65e951172bfa8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The equity method of accounting for investments in general partnerships is generally appropriate for accounting by limited partners for their investments in limited partnerships. A limited partner's interest may be so minor that the limited partner may have virtually no influence over partnership operating and financial policies. Such a limited partner is, in substance, in the same position with respect to the investment as an investor that owns a minor common stock interest in a corporation, and, accordingly, the limited partner should account for its investment in accordance with Topic 321. ##### [323-970-25-7](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:012e012cb5c8819d00eb97c09da0f75312ea412996bf226f36b0526df19cbb36 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2016-01](https://asc.understandingaccounting.org/updates/asu-2016-01/). ##### [323-970-25-8](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-8) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:206cbfce1dc8d7b9805e2fefd3a9b94908832ab2cbbb20bc360241d663b632f7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the substance of the partnership arrangement is such that the general partners are not in control of the major operating and financial policies of the partnership, a limited partner may be in control. An example could be a limited partner holding over 50 percent of the limited partnership's [kick-out rights](https://asc.understandingaccounting.org/glossary/k/#kick-out-rights-voting-interest-entity-definition "The rights underlying the limited partner's or partners' ability to dissolve (liquidate) the limited partnership or otherwise remove the general partners without cause.") through voting interests in accordance with paragraph [810-10-15-8A](https://asc.understandingaccounting.org/asc/810/10/#810-10-15-8A). A controlling limited partner shall be guided in accounting for its investment by the principles for investments in subsidiaries in Topic 810 on consolidation. Noncontrolling limited partners shall account for their investments by the equity method and shall be guided by the provisions of Topic 323, as discussed in the guidance beginning in paragraph [970-323-25-5](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-5), or by the guidance in Topic 321. #### Corporate Joint Ventures ##### [323-970-25-9](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-9) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:87633b02349dfd574d1a390a1a34ddeb6688da14808f7e08d72a8635e5f05024 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Topic 323 provides the standards for use of the equity method for [corporate joint ventures](https://asc.understandingaccounting.org/glossary/c/#corporate-joint-venture "A corporation owned and operated by a small group of entities (the joint venturers) as a separate and specific business or project for the mutual benefit of the members of the group. A government may also be a member of the group. The purpose of a corporate joint venture frequently is to share risks and rewards in developing a new market, product or technology; to combine complementary technological knowledge; or to pool resources in developing production or other facilities. A corporate joint venture also usually provides an arrangement under which each joint venturer may participate, directly or indirectly, in the overall management of the joint venture. Joint venturers thus have an interest or relationship other than as passive investors. An entity that is a subsidiary of one of the joint venturers is not a corporate joint venture. The ownership of a corporate joint venture seldom changes, and its stock is usually not traded publicly. A noncontrolling interest held by public ownership, however, does not preclude a corporation from being a corporate joint venture.") and includes guidance for applying that method in the financial statements of the investor. That Topic applies to corporate joint ventures created to own or operate real estate projects. ##### [323-970-25-10](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-10) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:052064a79b6b393265ce05ca295194f48ff7bf6cdc5bc466d6f43fa337dafa09 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Accordingly, an investment in a corporate subsidiary that is a [real estate venture](https://asc.understandingaccounting.org/glossary/r/#real-estate-venture "Any of the following: a joint venture, a general partnership, a limited partnership, and an undivided interest.") shall be accounted for by the investor-parent using the principles applicable to investments in subsidiaries rather than those applicable to investments in corporate joint ventures. ##### [323-970-25-11](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-11) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:232986178f1ebbd7d74129bbef7d79b85a39de5f5271c758b905b6550c4dab8b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Noncontrolling shareholders in such a real estate venture shall account for their investment using the principles applicable to investments in common stock set forth in Topic 321 or 323. #### Undivided Interests ##### [323-970-25-12](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-12) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:ccd31422c8816f64dfd3298982428afd57bcd9ed402b566300837bc1d84204c7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If real property owned by undivided interests is subject to [joint control](https://asc.understandingaccounting.org/glossary/j/#joint-control "Occurs if decisions regarding the financing, development, sale, or operations require the approval of two or more of the owners.") by the owners, the investor-venturers shall not present their investments by accounting for their pro rata share of the assets, liabilities, revenues, and expenses of the ventures. Most real estate ventures with ownership in the form of undivided interests are subject to some level of joint control. Accordingly, such investments shall be presented in the same manner as investments in noncontrolled partnerships. #### Acquisition, Development, and Construction Arrangements ##### [323-970-25-13](https://asc.understandingaccounting.org/asc/323/970/#323-970-25-13) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:49.098Z to 2026-09-09T23:42:49.098Z Record version: sha256:5418c791e004aefbd2ab79d31699e144320e12eb01df379734317cd5e631f084 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See the [Acquisition, Development, and Construction Subsection](https://asc.understandingaccounting.org/asc/310/10/#25-recognition) of Section 310-10-25 for a discussion of when [acquisition, development, and construction arrangements](https://asc.understandingaccounting.org/glossary/a/#acquisition-development-and-construction-arrangements "Acquisition, development, or construction arrangements, in which a lender, usually a financial institution, participates in expected residual profit from the sale or refinancing of property.") are required to be accounted for as a real estate joint venture rather than a loan. In those circumstances, the [Acquisition, Development, and Construction Subsection](https://asc.understandingaccounting.org/asc/310/10/#35-subsequent-measurement) of Section 310-10-35, and the [Acquisition, Development, and Construction Subsection](https://asc.understandingaccounting.org/asc/310/10/#40-derecognition) of Section 310-10-40 provide further guidance for accounting for such arrangements. Source downloaded (UTC): 2026-09-09T23:42:52.756Z to 2026-09-09T23:42:52.756Z Record version: sha256:28a6194eb31345632e7fea605c7690ea4f2286c17739c1c72ca74d47276c614f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970-30: 30 Initial Measurement [Read section](https://asc.understandingaccounting.org/asc/323/970/#30-initial-measurement) SEC content: no #### Accounting by the Investor for Certain Transactions with a Real Estate Venture ##### [323-970-30-1](https://asc.understandingaccounting.org/asc/323/970/#323-970-30-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:52.756Z to 2026-09-09T23:42:52.756Z Record version: sha256:af07ff6121c10c3aa6f1d501b20326c939ad0123b8d7d9a902f9fa529af9c36b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Section applies to investments accounted for by the equity method. ##### [323-970-30-2](https://asc.understandingaccounting.org/asc/323/970/#323-970-30-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:52.756Z to 2026-09-09T23:42:52.756Z Record version: sha256:eab64f968b7ab7184f93dcbf8332594826839e5b1f94e8bee20a45acf5151bda Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If all investors contribute cash at the formation of the [real estate venture](https://asc.understandingaccounting.org/glossary/r/#real-estate-venture "Any of the following: a joint venture, a general partnership, a limited partnership, and an undivided interest."), each investor shall record its investment at the amount of the cash contributed. ##### [323-970-30-3](https://asc.understandingaccounting.org/asc/323/970/#323-970-30-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:52.756Z to 2026-09-09T23:42:52.756Z Record version: sha256:71f538c4c36ef8c9cbbb3ae48de001d170e099ee38a30f4e47558f77d1964298 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An investor that contributes real estate to the capital of a real estate venture generally should record its investment in the venture at fair value when the real estate is derecognized, regardless of whether the other investors contribute cash, property, or services. The transaction shall be accounted for in accordance with the guidance in paragraphs [360-10-40-3A through 40-3C](https://asc.understandingaccounting.org/asc/360/10/#360-10-40-3A) . Some transactions are sales of an ownership interest that result in an entity being an investor in a real estate venture. An example of such a transaction includes one in which investor A contributes real estate with a fair value of $2,000 to a venture and investor B contributes cash in the amount of $1,000. The real estate is not considered a business or nonprofit activity and, therefore, is within the scope of Subtopic 610-20 on gains and losses from the derecognition of nonfinancial assets. Investor A immediately withdraws the cash contributed by investor B and, following such contributions and withdrawals, each investor has a 50 percent interest in the venture (the only asset of which is the real estate). Assuming investor A does not have a controlling financial interest in the venture, investor A applies the guidance in paragraphs [610-20-25-5](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-5) and [610-20-25-7](https://asc.understandingaccounting.org/asc/610/20/#610-20-25-7). When investor A meets the criteria to derecognize the property, investor A measures its retained ownership interest at fair value consistent with the guidance in paragraph [610-20-32-4](https://asc.understandingaccounting.org/asc/610/20/#610-20-32-4) and includes that amount in the consideration used in calculating the gain or loss on derecognition of the property. ##### [323-970-30-4](https://asc.understandingaccounting.org/asc/323/970/#323-970-30-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:52.756Z to 2026-09-09T23:42:52.756Z Record version: sha256:16132d0e7557191aac66f4277f33893154017e9c982e84ec5ddae2eb79a397cd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2017-05](https://asc.understandingaccounting.org/updates/asu-2017-05/). ##### [323-970-30-5](https://asc.understandingaccounting.org/asc/323/970/#323-970-30-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:52.756Z to 2026-09-09T23:42:52.756Z Record version: sha256:154ec70feeddc03ba6424d89ce049676cb2a48fab5f7ef1bbec0d77269eac7f4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2017-05](https://asc.understandingaccounting.org/updates/asu-2017-05/). ##### [323-970-30-6](https://asc.understandingaccounting.org/asc/323/970/#323-970-30-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:52.756Z to 2026-09-09T23:42:52.756Z Record version: sha256:abcd33c82a56efb722ce4ac578a7059a588a9074821095d523b5f9cf3baffd00 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The contribution of real property or an intangible to a partnership or joint venture shall be accounted for in accordance with Subtopic 610-20. The contribution of services or real estate [syndication activities](https://asc.understandingaccounting.org/glossary/s/#syndication-activities "Efforts to directly or indirectly sponsor the formation of entities that acquire interests in real estate by raising funds from investors. As consideration for their investments, the investors receive ownership or other financial interests in the sponsored entities. All general partners in syndicated partnerships are deemed to perform syndication activities.") in which the syndicators receive or retain partnership interests are accounted for in accordance with the guidance in Topic 606 on revenue from contracts with customers. ##### [323-970-30-7](https://asc.understandingaccounting.org/asc/323/970/#323-970-30-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:52.756Z to 2026-09-09T23:42:52.756Z Record version: sha256:13ae08b55026e15762f8137eac327410a6824d254ba0e63709907e5a8251bf13 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An investor shall not record as income its equity in the venture's profit from a sale of real estate to that investor; the investor's share of such profit shall be recorded as a reduction in the carrying amount of the purchased real estate and recognized as income on a pro rata basis as the real estate is depreciated or when it is sold to a third party. Similarly, if a venture performs services for an investor and the cost of those services is capitalized by the investor, the investor's share of the venture's profit in the transaction shall be recorded as a reduction in the carrying amount of the capitalized cost. Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:a110aa2b5e36825b24458110950360a6b8f58438a5e8c189a54482a8951d88d0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/323/970/#35-subsequent-measurement) SEC content: no #### Applying the Equity Method ##### [323-970-35-1](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:a6e4ba2f9102289b25cb1e6870b45bc69966b0578deb251a94bd17db5644d0cd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Section applies to investments accounted for by the equity method. ##### [323-970-35-2](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:0f77b51fc385f0358dea7755d33226673558e2b3b535f43d750608182548629d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Investors shall record their share of the real estate venture's losses, determined in conformity with generally accepted accounting principles (GAAP), without regard to unrealized increases in the estimated fair value of the venture's assets. ##### [323-970-35-3](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:19d011c2194a437c3e084637ed11ddefb0354b3d7e5790959ff2fc8a2be0a994 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An investor that is liable for the obligations of the venture or is otherwise committed to provide additional financial support to the venture shall record its equity in [real estate venture](https://asc.understandingaccounting.org/glossary/r/#real-estate-venture "Any of the following: a joint venture, a general partnership, a limited partnership, and an undivided interest.") losses in excess of its investment, including loans and advances. ##### [323-970-35-4](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:da414a4f1893a780ccd74c08d275072c7ee6df8a29e7840b46fab6120fd9740c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following are examples of such circumstances: 1. a The investor has a legal obligation as a guarantor or general partner. 2. b The investor has indicated a commitment, based on considerations such as business reputation, intra-entity relationships, or credit standing, to provide additional financial support. Such a commitment might be indicated by previous support provided by the investor or statements by the investor to other investors or third parties of the investor's intention to provide support. ##### [323-970-35-5](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:c4aa6464a6eca0e68d24eef707c58f88234ea448826c0c92d3fed66b05435fe1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An investor, though not liable or otherwise committed to provide additional financial support, shall provide for losses in excess of investment when the imminent return to profitable operations by the venture appears to be assured. For example, a material nonrecurring loss of an isolated nature, or start-up losses, may reduce an investment below zero though the underlying profitable pattern of an investee is unimpaired. ##### [323-970-35-6](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:d195916cc4c30bec4805b412fc975909728755548abc8ac9a8197b9ad5adf0b1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An investor in a real estate venture shall report its recorded share of losses in excess of its investment, including loans and advances, as a liability in its financial statements. ##### [323-970-35-7](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:f90dd488a4579f84993c8e624e008e144f4e17ad0bf95c830045bc7dc978bbdc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If an investor does not recognize venture losses in excess of its investment, loans, and advances and the venture subsequently reports net income, the investor shall resume applying the equity method only after its share of such net income equals the share of net losses not recognized during the period in which equity accounting was suspended. ##### [323-970-35-8](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-8) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:e47e1da5229316b0debb5aacdbd519b83f698f47665b391b57b8f812ffb0fb8e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If it is probable that one or more investors cannot bear their share of losses, the remaining investors shall record their proportionate shares of venture losses otherwise allocable to investors considered unable to bear their share of losses. This does not apply for real property jointly owned and operated as undivided interests in assets if the claims or liens of investors' creditors are limited to investors' respective interests in such property. ##### [323-970-35-9](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-9) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:9175a845712645cdb45acb51ec52fca9dbfdbe98099d8932c1ef50eb56929f0c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. When the venture subsequently reports income, those remaining investors shall record their proportionate share of the venture's net income otherwise allocable to investors considered unable to bear their share of losses until such income equals the excess losses they previously recorded. An investor who is deemed by other investors to be unable to bear its share of losses shall continue to record its contractual share of losses unless it is relieved from the obligation to make payment by agreement or operation of law. ##### [323-970-35-10](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-10) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:f718b3c2639cd8022845bf27d362dd314c54264f089d29cd175661be773486bd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The accounting by an investor for losses otherwise allocable to other investors shall be governed by the provisions of Subtopic 450-20 relating to loss contingencies. Accordingly, the investor shall record a proportionate share of the losses otherwise allocable to other investors if it is probable that they will not bear their share. In this connection, each investor shall look primarily to the fair value of the other investors' interests in the venture and the extent to which the venture's debt is nonrecourse in evaluating their ability and willingness to bear their allocable share of losses. An investor may not be able to apply the general rule to an investment in an [undivided interest](https://asc.understandingaccounting.org/glossary/u/#undivided-interest "An ownership arrangement in which two or more parties jointly own property, and title is held individually to the extent of each party's interest.") because the extent to which the interests of other investors are encumbered by liens may not be known. However, there may be satisfactory alternative evidence of an ability and willingness of other investors to bear their allocable share of losses. Such evidence might be, for example, that those investors previously made loans or contributions to support cash deficits, possess satisfactory financial standing (as may be evidenced by satisfactory credit ratings), or have provided adequately collateralized guarantees. ##### [323-970-35-11](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-11) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:d69b59daa5b7d3c8479189c4f3742e55b235b94101af13877896d72fdc75178a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Section 323-10-35 for additional guidance regarding accounting by equity method investor for investee losses when the investor has both loans and equity interest. ##### [323-970-35-12](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-12) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:efc050c8de2bc3bfd499324e5ba0544e7381b7b9755e1fd883ab9ae7bca51a8b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A loss in value of an investment other than a temporary decline shall be recognized. Such a loss in value may be indicated, for example, by a decision by other investors to cease providing support or reduce their financial commitment to the venture. ##### [323-970-35-13](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-13) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:3ac47078f554449a77ef0faf15da05ea474ede547a83c35471494202d6ccde4a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a transaction with a real estate venture confirms that there has been a loss in the value of the asset sold that is other than temporary and that has not been recognized previously, the loss shall be recognized on the books of the transferor. ##### [323-970-35-14](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-14) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:083728146db6c9323fd55c8ed5ffcae62dc5605ed907ae88e39289b3a224f7b3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Intra-entity profit shall be eliminated by the investor in relation to the investor's [noncontrolling interest](https://asc.understandingaccounting.org/glossary/n/#noncontrolling-interest "The portion of equity (net assets) in a subsidiary not attributable, directly or indirectly, to a parent. A noncontrolling interest is sometimes called a minority interest.") in the investee, unless one of the exceptions in paragraph [323-10-35-7](https://asc.understandingaccounting.org/asc/323/10/#323-10-35-7) applies. An investor that controls the investee and enters into a transaction with the investee shall eliminate all of the interentity profit on assets remaining within the group. (See Subsection 323-30-35 for accounting guidance concerning partnership ownership interest.) ##### [323-970-35-15](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-15) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:5eb64962d6f3fbfe865e837d7d0eeddd3c5a13810917eced808c8a23496aa603 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A sale of property in which the seller holds or acquires a noncontrolling interest in the buyer shall be evaluated in accordance with the guidance in paragraphs [360-10-40-3A through 40-3B](https://asc.understandingaccounting.org/asc/360/10/#360-10-40-3A) . No profit shall be recognized if the seller controls the buyer. ##### [323-970-35-16](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-16) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:ae1bed15b583315f6041773ab7cfa3bd0b53c357c9ec4bcefd9268d351ad1796 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Venture agreements may designate different allocations among the investors for any of the following: 1. a Profits and losses 2. b Specified costs and expenses 3. c Distributions of cash from operations 4. d Distributions of cash proceeds from liquidation. ##### [323-970-35-17](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-17) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:1dc5cd5fd6383a3d6704ca5a6ca3ce8c4f32bc5f213a4798c08a83732428faea Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Such agreements may also provide for changes in the allocations at specified times or on the occurrence of specified events. Accounting by the investors for their equity in the venture's earnings under such agreements requires careful consideration of substance over form and consideration of underlying values as discussed in paragraph [970-323-35-10](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-10). To determine the investor's share of venture net income or loss, such agreements or arrangements shall be analyzed to determine how an increase or decrease in net assets of the venture (determined in conformity with GAAP) will affect cash payments to the investor over the life of the venture and on its liquidation. Specified profit and loss allocation ratios shall not be used to determine an investor's equity in venture earnings if the allocation of cash distributions and liquidating distributions are determined on some other basis. For example, if a venture agreement between two investors purports to allocate all depreciation expense to one investor and to allocate all other revenues and expenses equally, but further provides that irrespective of such allocations, distributions to the investors will be made simultaneously and divided equally between them, there is no substance to the purported allocation of depreciation expense. ##### [323-970-35-18](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-18) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:ac2394d8d3660ae056b896a49fb5e8c07a9a5ff167c87164dddac126a524cab8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Section [323-30-25](https://asc.understandingaccounting.org/asc/323/30/#25-recognition) for guidance concerning partnership profit recognition. #### Accounting for Other Transactions with a Real Estate Venture ##### [323-970-35-19](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-19) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:60d23f52820760ded5870662e0f8cfbd0b154763dbafa3e7bfb5eadb6b670248 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See the [Acquisition, Development, and Construction Subsection](https://asc.understandingaccounting.org/asc/310/10/#35-subsequent-measurement) of Section 310-10-35 for additional guidance concerning subsequent measurement of [acquisition, development, and construction arrangements](https://asc.understandingaccounting.org/glossary/a/#acquisition-development-and-construction-arrangements "Acquisition, development, or construction arrangements, in which a lender, usually a financial institution, participates in expected residual profit from the sale or refinancing of property.") that are required to be accounted for as real estate joint ventures under that guidance. ##### [323-970-35-20](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-20) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:d1908a6666be20458e4a49d16f8ea941e3e6339dc0e66408e52d693951b1df83 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In the real estate industry, the accounts of a venture may reflect accounting practices, such as those used to prepare tax basis data for investors, that vary from GAAP. If the financial statements of the investor are to be prepared in conformity with GAAP, such variances that are material shall be eliminated in applying the equity method. ##### [323-970-35-21](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-21) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:5571dc2a35d304ff2004513c2d00b8ca758438d26b5bf05fc8cd2a24e01756a3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Section 323-30-35 regarding income tax to be provided on profits accrued by investor-partners and tax liabilities applicable to partnership interests. ##### [323-970-35-22](https://asc.understandingaccounting.org/asc/323/970/#323-970-35-22) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:55.650Z to 2026-09-09T23:42:55.650Z Record version: sha256:a24cf738e844a82c93901c8c3cdf53ee80150ca2f332c04e1492db3b2191ca4f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Interest on loans and advances that are in substance capital contributions (for example, if all the investors are required to make loans and advances proportionate to their equity interests) shall be accounted for as distributions rather than as interest income by the investors. Source downloaded (UTC): 2026-09-09T23:42:57.983Z to 2026-09-09T23:42:57.983Z Record version: sha256:04102d4da56d6cd21f27d7e5cdf095c7050e8f18648f9fd0e260f1bc78124ef2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/323/970/#40-derecognition) SEC content: no #### Sale of an Investment in a Real Estate Venture ##### [323-970-40-1](https://asc.understandingaccounting.org/asc/323/970/#323-970-40-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:57.983Z to 2026-09-09T23:42:57.983Z Record version: sha256:2467d6fa25e009373d85ebbdd6ac97fa8b0d062548d9a0999311a0711512dfbb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A sale of an investment in a consolidated [real estate venture](https://asc.understandingaccounting.org/glossary/r/#real-estate-venture "Any of the following: a joint venture, a general partnership, a limited partnership, and an undivided interest.") (including the sale of stock in a corporate real estate venture) shall be evaluated under the guidelines set forth in paragraphs [360-10-40-3A through 40-3B](https://asc.understandingaccounting.org/asc/360/10/#360-10-40-3A) . The sale of a noncontrolling investment in a real estate venture that is being accounted for in accordance with Topic 320 on investments—debt securities; Topic 321 on investments—equity securities; Topic 323 on investments—equity method and joint ventures; or Topic 325 on investments—other, shall be accounted for in accordance with the guidance in Topic 860 on transfers and servicing. #### Acquisition, Development, and Construction Arrangements ##### [323-970-40-2](https://asc.understandingaccounting.org/asc/323/970/#323-970-40-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:42:57.983Z to 2026-09-09T23:42:57.983Z Record version: sha256:6e775ced58dd65afd03d0a1279a27cbd35087e4cf69be4f57025284283a89e8e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See the [Acquisition, Development, and Construction Subsection](https://asc.understandingaccounting.org/asc/310/10/#40-derecognition) of Section 310-10-40 for additional guidance concerning derecognition of [acquisition, development, and construction arrangements](https://asc.understandingaccounting.org/glossary/a/#acquisition-development-and-construction-arrangements "Acquisition, development, or construction arrangements, in which a lender, usually a financial institution, participates in expected residual profit from the sale or refinancing of property.") that are required to be accounted for as real estate joint ventures under that guidance. Source downloaded (UTC): 2026-09-09T23:43:01.427Z to 2026-09-09T23:43:01.427Z Record version: sha256:2a08e7586cc4a237e960a9382f2bdfdb681fafad29b3e447c4d07d838c7aa30b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 323-970-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/323/970/#45-other-presentation-matters) SEC content: no ##### [323-970-45-1](https://asc.understandingaccounting.org/asc/323/970/#323-970-45-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:43:01.427Z to 2026-09-09T23:43:01.427Z Record version: sha256:cf8b2ade20afb31c54b8364a98698406690c13e1b5fb33ce8265552076fbd824 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Section 970-323-25 for discussion of certain presentation matters.