IAS 28 - Investments in Associates and Joint Ventures is a standard issued by the International Accounting Standards Board (IASB) that prescribes the accounting method for interests in associates and joint ventures. This standard primarily requires the equity method of accounting, where the investor recognizes their share of the associate's or joint venture's net income in their own financial statements. It ensures transparent and consistent reporting of such investments, aligning with the broader contour of International Financial Reporting Standards (IFRS).

Under IAS 28, an associate is categorized as an entity over which significant influence is exercised, yet not controlled. In such scenarios, the entity’s performance and results directly impact the financial statements of the parent organization. For example, if a corporation owns 25% of a subsidiary company, the corporation may need to adjust its financial reports to reflect the income and expenses proportional to its share.

The standard’s application varies for joint ventures, where two or more parties have joint control over the economic activities undertaken. IAS 28 dictates consistent equity accounting across these scenarios to prevent anomalies in financial reporting practices.

Companies involved in diverse investment activities leverage IAS 28 to maintain transparency, as such shareholding intricacies often affect stakeholder decisions significantly. Thus, understanding and correctly implementing IAS 28 becomes essential for transparent financial reporting.