Definitions for "equity method"
An accounting method used to determine income derived from a companys investment...
is a method of accounting for investments in associated companies.
An accounting method used to reflect an investor's interest in a company. This method is used when the investor owns 20 percent or more of the investee and has significant influence over the investee. Under the equity method, the investment is originally recorded on the books of the investor at its cost. Subsequently, the asset value of that investment on the investor's financial statements is increased or decreased by the investor's proportionate share of the increase or decrease in the investee's net worth.