BC24 The IFRS classifies joint arrangements into two types - 'joint operations' and 'joint ventures'. Parties with joint control of a joint operation have rights to the assets, and obligations for the liabilities, relating to the arrangement ('joint operators'), whereas parties with joint control of a joint venture ('joint venturers') have rights to the net assets of the arrangement.

BC25 The classification of joint arrangements into two types was considered by the Board in its redeliberation of the exposure draft. ED 9 proposed to classify joint arrangements into three types - 'joint operations', 'joint assets' and 'joint ventures'. The Board observed that in some instances it might be difficult to assess whether an arrangement is a 'joint operation' or a 'joint asset'. This is because elements from both types of joint arrangement are sometimes present (in many arrangements joint assets are also jointly operated, and therefore such arrangements could be viewed as a 'joint asset' or as a 'joint operation').

Additionally, both types of joint arrangement result in the same accounting outcome (ie recognition of assets and liabilities and corresponding revenues and expenses). For these reasons, the Board decided to merge 'joint operations' and 'joint assets' into a single type of joint arrangement called 'joint operation'. This decision simplifies the IFRS by aligning the two types of joint arrangement presented by the IFRS (ie 'joint operations' and 'joint ventures') with the two possible accounting outcomes (ie recognition of assets, liabilities, revenues and expenses, or recognition of an investment accounted for using the equity method).