A financial statement that is prepared and presented by a parent (an investment entity, by virtue of its control of a subsidiary) or an investor with joint control of, or significant influence over, an investee. Separate financial statements are prepared on a cost basis for investments in subsidiaries, joint ventures and associates in the cases where a parent is required to prepare a separate set of financials for these investments. However, if an entity (investor) opts to measure its investments in subsidiaries, associates or joint ventures at fair value through profit or loss (FVTPL), the separate financial statements must be prepared based on the same measurement method.

If an entity applies the equity method in its financial statements, then such statements cannot be classified as separate financial statements. Likewise, an entity that has no control, joint control or significant influence over an investee cannot claim to have separate financial statements.