IBERSOL | Annual Report 2020

Consolidated Financial Statements (b) Entities where the group exercises control jointly with other partners The Group’s interests in entities where the group exercises control jointly with other partners are measured through the equity method, using IFRS 11, from the date when joint control is acquired. The Group integrates its share in assets and liabilities in a heading in the Consolidated Statement of Financial Position and the costs and income of the joint venture in a line in the Consolidated Statement of Income and other comprehensive income. Balances and transactions between Group companies and entities where the group exercises control jointly with other partners are not eliminated in proportion to the control attributable to the Group. The excess of the acquisition cost over the fair value of identifiable assets and liabilities of the entity where the group exercises control jointly with other partners, on the acquisition date, is recognized as a financial investment. The entities where the group exercises control jointly with other partners are de- tailed in Note 5. (c) Entities where the group has significant influence The existence of significant influence by the Group is usually demonstrated in one or more of the following ways: - Representation on the Executive Board of Directors or equivalent governing body; - Participation in policy-making processes, including participation in decisions on dividends or other distributions; - Existence of material transactions between the Group and the investee; - Exchange of management staff; and - Provision of essential technical information. Financial investments in associated companies are recorded using the equity meth- od, being included in the consolidated statement of financial position under the heading “Financial investments in associated companies”. Financial investments in associates are subject to impairment tests whenever there are signs of impairment. An impairment loss is recognized in the income statement by the amount of the excess of the asset’s carrying amount over its recoverable amount. The recoverable amount is the highest of an asset’s fair value less the costs inherent in its sale and its value in use. For carrying out impairment tests, each par- ticipation is analyzed separately. Impairment losses on financial investments in as- sociates are reversible. The entities that qualify as associates are listed in Note 5. 318