ASC

ASC 810-910

Contractors—Construction

810 Consolidation

Download JSONDownload Markdown3 paragraphs · 3 sectionsJump to summary

Source downloaded: .Record version 7f7ed8ffe124. Effective date must be checked in the source.

In brief

IntermediateConsolidationPresentationIndustry-specificFinancial statement presentation

This Subtopic addresses consolidation issues for construction contractors, principally the availability of proportionate gross presentation for investments in unincorporated entities (such as construction joint ventures) that are accounted for under the equity method. Per 810-910-45-1, referencing 810-10-45-14, proportionate gross presentation is generally prohibited for equity-method investments in unincorporated legal entities, but an exception exists when the investee operates in the construction industry (or an extractive industry). Its scope follows that of Subtopic 910-10 (see 910-10-15).

Key points (4)
  • This Subtopic provides guidance on consolidation by a construction contractor (810-910-05-1).
  • The scope is the same as the Contractors—Construction Overall Subtopic, Section 910-10-15 (810-910-15-1).
  • Under 810-10-45-14, proportionate gross financial statement presentation is not appropriate for an investment in an unincorporated legal entity accounted for under the equity method, except where the investee is in the construction industry or an extractive industry (810-910-45-1).
  • The extractive-industry parallels to this exception are found at 930-810-45-1 (mining) and 932-810-45-1 (oil and gas) (810-910-45-1).

For students. The exam point is narrow: proportionate (pro rata) gross presentation of an equity-method investee is a rare exception limited to unincorporated construction and extractive-industry ventures. Students often wrongly assume proportionate consolidation is generally available for any jointly controlled operation, or that it applies to incorporated joint ventures.

proportionate gross presentationequity methodunincorporated legal entityconstruction joint ventureconsolidationindustry exceptionconstruction contractor

Machine-generated study aid for ASC 810-910. Check the source paragraphs below.

810-910-05Overview and Background

Source downloaded: .Record version cf0ab8c97e68. Effective date must be checked in the source.

810-910-05-1
This Subtopic provides guidance on consolidation by a construction contractor.

810-910-15Scope and Scope Exceptions

Source downloaded: .Record version 787275f85d07. Effective date must be checked in the source.

Overall Guidance

810-910-15-1
This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 910-10-15.

810-910-45Other Presentation Matters

Source downloaded: .Record version 4c24a9aa1c2a. Effective date must be checked in the source.

810-910-45-1
Paragraph 810-10-45-14 explains that a proportionate gross financial statement presentation is not appropriate for an investment in an unincorporated legal entity accounted for by the equity method of accounting unless the investee is in either the construction industry (as discussed in this Topic) or an extractive industry (see paragraphs 930-810-45-1 and 932-810-45-1).

Related subtopics