As we all know, many businesses aim to achieve higher profits, increase their market share, expand internationally, diversify business risk, and reduce costs by acquiring a portion of another business's capital.

Those businesses/investors should use the equity method of accounting to measure their share in the investee's capital and operations when their ownership interest grants them a significant influence over the investee's operating and financial policies.

This course discusses the equity method and explains how to distinguish the Equity-method investees from other investments.

This course illustrates the accounting treatment for equity method investees step-by-step, including recognition criteria, subsequent measurement, the proper accounting treatment for the resulting gain/(loss), and dividends.

This course uses practical cases and examples that simplify the theory behind US GAAP standard ASC Topic 323 "Investments – Equity Method and Joint Ventures" and IFRS standard IAS 28 "Investments in Associates and Joint Ventures," highlighting the main differences between them.

Course Key Concepts: Equity Method, Equity-method Investees, Associates, Affiliates, Joint Ventures, ASC 323, IAS 28, Significant Influence, Investments.

Learning Objectives
  • Explore the main differences between Equity-method investees and other types of investments.
  • Discover the proper accounting treatment for equity method investments.
  • Identify how to measure the acquired share of equity-method investee's equity.
  • Recognize the differences between US GAAP and IFRS in applying the equity method of accounting.
Last updated/reviewed: August 15, 2023
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5 Reviews (25 ratings)


Member's Profile
Good informative course providing valuable information and insights. I like the practice questions and the scenarios; they were helpful in illustrating the learning points.

Anonymous Author
good overview of when to apply the equity method and how to complete the transactions

Anonymous Author
it's a short course but goes in deep detail and discusses the material further

Member's Profile
The content was good. The teacher could use some enthusiasm

Member's Profile
Moataz course on Equity Method Accounting was well prepared

Course Complexity: Foundational

No advanced preparation or prerequisites are required for this course.

Education Provider Information
Company: Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact: For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Instructor for this course
Course Syllabus
  Introduction to Accounting for Equity Method Investments2:48
  Significant Influence8:33
  Assessment of Significant Influence6:56
  Acquisition of an Equity Method Investee9:55
  Measurement After Initial Recognition-Part 16:31
  Case Study 17:31
  Measurement After Initial Recognition-Part 21:55
  Case Study 27:49
  Intra-entity Transactions3:22
  Changes in Ownership Level5:27
  Accounting for Equity Method Investments1:05:43
  Slides: Accounting for Equity Method InvestmentsPDF
  Accounting for Equity Method Investments Glossary/ IndexPDF