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Presentation of Financial Statements

Ind AS - 001 - Rule - B. Indian Accounting Standards (Ind AS) - Companies Law - Ind AS - 001 - Indian Accounting Standard (Ind AS) 1 (This Indian Accounting Standard includes paragraphs set in bold type and plain type, which have equal authority. Paragraphs in bold type indicate the main principles). Objective 1 This Standard prescribes the basis for presentation of general purpose financial statements to ensure comparability both with the entity s financial statements of previous periods and wi .....

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ture and content of condensed interim financial statements prepared in accordance with Ind AS 34, Interim Financial Reporting. However, paragraphs 15-35 apply to such financial statements. This Standard applies equally to all entities, including those that present consolidated financial statements in accordance with Ind AS 110, Consolidated Financial Statements, and those that present separate financial statements in accordance with Ind AS 27, Separate Financial Statements. 5 This Standard uses .....

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The following terms are used in this Standard with the meanings specified: General purpose financial statements (referred to as financial statements ) are those intended to meet the needs of users who are not in a position to require an entity to prepare reports tailored to their particular information needs. Impracticable Applying a requirement is impracticable when the entity cannot apply it after making every reasonable effort to do so. Indian Accounting Standards (Ind ASs) are Standards pres .....

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could influence economic decisions of users, and so be material, requires consideration of the characteristics of those users. The Framework for the Preparation and issued by the Institute of Chartered Accountants of India states in paragraph 25 that users are assumed to have a reasonable knowledge of business and economic activities and accounting and a willingness to study the information with reasonable diligence. Therefore, the assessment needs to take into account how users with such attrib .....

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luding reclassification adjustments) that are not recognised in profit or loss as required or permitted by other Ind ASs. The components of other comprehensive income include: (a) changes in revaluation surplus (see Ind AS 16, Property, Plant and Equipment and Ind AS 38, Intangible Assets); (b) reameasurements of defined benefit plans (see Ind AS 19, Employee Benefits); (c) gains and losses arising from translating the financial statements of a foreign operation (see Ind AS 21, The Effects of Ch .....

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ing instruments that hedge investments in equity instruments measured at fair value through other comprehensive income in accordance with paragraph 5.7.5 of Ind AS 109 (see Chapter 6 of Ind AS 109); (f) for particular liabilities designated as at fair value through profit or loss, the amount of the change in fair value that is attributable to changes in the liability s credit risk (see paragraph 5.7.7 of Ind AS 109); (g) changes in the value of the time value of options when separating the intri .....

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designation of that financial instrument as the hedging instrument (see Chapter 6 of Ind AS 109). Owners are holders of instruments classified as equity. Profit or loss is the total of income less expenses, excluding the components of other comprehensive income. Reclassification adjustments are amounts reclassified to profit or loss in the current period that were recognised in other comprehensive income in the current or previous periods. Total comprehensive income is the change in equity duri .....

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rument(described in paragraphs 16A and 16B of Ind AS 32) (b) an instrument that imposes on the entity an obligation to deliver to another party a pro rata share of the net assets of the entity only on liquidation and is classified as an equity instrument (described in paragraphs 16C and 16D of Ind AS 32). Financial statements Purpose of financial statements 9 Financial statements are a structured representation of the financial position and financial performance of an entity. The objective of fi .....

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by and distributions to owners in their capacity as owners; and (f) cash flows. This information, along with other information in the notes, assists users of financial statements in predicting the entity s future cash flows and, in particular, their timing and certainty. Complete set of financial statements 10 A complete set of financial statements comprises: (a) a balance sheet as at the end of the period ; (b) a statement of profit and loss for the period; (c) Statement of changes in equity fo .....

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cial statements in accordance with paragraphs 40A-40D. 10A An entity shall present a single statement of profit and loss, with profit or loss and other comprehensive income presented in two sections. The sections shall be presented together, with the profit or loss section presented first followed directly by the other comprehensive income section. 11 An entity shall present with equal prominence all of the financial statements in a complete set of financial statements. 12 [Refer Appendix 1] 13 .....

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r investment to maintain and enhance financial performance, including its dividend policy; (b) the entity s sources of funding and its targeted ratio of liabilities to equity; and (c) the entity s resources not recognised in the balance sheet in accordance with Ind ASs. 14 Many entities also present, outside the financial statements, reports and statements such as environmental reports and value added statements, particularly in industries in which environmental factors are significant and when .....

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ccordance with the definitions and recognition criteria for assets, liabilities, income and expenses set out in the Framework. The application of Ind ASs, with additional disclosure when necessary, is presumed to result in financial statements that present a true and fair view. 16 An entity whose financial statements comply with Ind ASs shall make an explicit and unreserved statement of such compliance in the notes. An entity shall not describe financial statements as complying with Ind ASs unle .....

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lly applies to an item. (b) to present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information. (c) to provide additional disclosures when compliance with the specific requirements in Ind ASs is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity s financial position and financial performance. 18 An entity cannot rectify inappropriate accounting poli .....

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arture. 20 When an entity departs from a requirement of an Ind AS in accordance with paragraph 19, it shall disclose: (a) that management has concluded that the financial statements present a true and fair view of the entity s financial position, financial performance and cash flows; (b) that it has complied with applicable Ind ASs, except that it has departed from a particular requirement to present a true and fair view; (c) the title of the Ind AS from which the entity has departed, the nature .....

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n Ind AS in a prior period, and that departure affects the amounts recognised in the financial statements for the current period, it shall make the disclosures set out in paragraph 20(c) and (d). 22 Paragraph 21 applies, for example, when an entity departed in a prior period from a requirement in an Ind AS for the measurement of assets or liabilities and that departure affects the measurement of changes in assets and liabilities recognised in the current period s financial statements. 23 In the .....

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reason why management has concluded that complying with that requirement is so misleading in the circumstances that it conflicts with the objective of financial statements set out in the Framework; and (b) for each period presented, the adjustments to each item in the financial statements that management has concluded would be necessary to present a true and fair view. 24 For the purpose of paragraphs 19-23, an item of information would conflict with the objective of financial statements when i .....

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e of financial statements is not achieved in the particular circumstances; and (b) how the entity s circumstances differ from those of other entities that comply with the requirement. If other entities in similar circumstances comply with the requirement, there is a rebuttable presumption that the entity s compliance with the requirement would not be so misleading that it would conflict with the objective of financial statements set out in the Framework. Going concern 25 When preparing financial .....

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e entity shall disclose those uncertainties. When an entity does not prepare financial statements on a going concern basis, it shall disclose that fact, together with the basis on which it prepared the financial statements and the reason why the entity is not regarded as a going concern. 26 In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but is not limited to, twelve months from the end .....

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e it can satisfy itself that the going concern basis is appropriate. Accrual basis of accounting 27 An entity shall prepare its financial statements, except for cash flow information, using the accrual basis of accounting. 28 When the accrual basis of accounting is used, an entity recognises items as assets, liabilities, equity, income and expenses (the elements of financial statements) when they satisfy the definitions and recognition criteria for those elements in the Framework. Materiality an .....

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data, which form line items in the financial statements. If a line item is not individually material, it is aggregated with other items either in those statements or in the notes. An item that is not sufficiently material to warrant separate presentation in those statements may warrant separate presentation in the notes. 2[30A When applying this and other Ind ASs an entity shall decide, taking into consideration all relevant facts and circumstances, how it aggregates information in the financial .....

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not material except when required by law. This is the case even if the Ind AS contains a list of specific requirements or describes them as minimum requirements. An entity shall also consider whether to provide additional disclosures when compliance with the specific requirements in Ind AS is insufficient to enable users of financial statements to understand the impact of particular transactions, other events and conditions on the entity s financial position and financial performance.] Offsetti .....

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future cash flows. Measuring assets net of valuation allowances-for example, obsolescence allowances on inventories and doubtful debts allowances on receivables-is not offsetting. 4[34 Ind AS 18, Revenue, defines revenue and requires an entity to measure it at the fair value of the consideration received or receivable, taking into account the amount of any trade discounts and volume rebates the entity allows. An entity undertakes, in the course of its ordinary activities, other transactions tha .....

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the asset and related selling expenses; and (b) an entity may net expenditure related to a provision that is recognised in accordance with Ind AS 37, Provisions, Contingent Liabilities and Contingent Assets, and reimbursed under a contractual arrangement with a third party (for example, a supplier s warranty agreement) against the related reimbursement.] 35 In addition, an entity presents on a net basis gains and losses arising from a group of similar transactions, for example, foreign exchange .....

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od covered by the financial statements: (a) the reason for using a longer or shorter period, and (b) the fact that amounts presented in the financial statements are not entirely comparable. 37 [Refer Appendix 1] Comparative information Minimum comparative information 38 Except when Ind ASs permit or require otherwise, an entity shall present comparative information in respect of the preceding period for all amounts reported in the current period s financial statements. An entity shall include co .....

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entity discloses in the current period details of a legal dispute, the outcome of which was uncertain at the end of the preceding period and is yet to be resolved. Users may benefit from the disclosure of information that the uncertainty existed at the end of the preceding period and from the disclosure of information about the steps that have been taken during the period to resolve the uncertainty. Additional comparative information 38C An entity may present comparative information in addition .....

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current period, the preceding period and one additional comparative period). However, the entity is not required to present a third balance sheet, a third statement of cash flows or a third statement of changes in equity (ie an additional financial statement comparative). The entity is required to present, in the notes to the financial statements, the comparative information related to that additional statement of profit and loss. 39- 40 [Refer Appendix 1] Change in accounting policy, retrospec .....

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effect on the information in the balance sheet at the beginning of the preceding period. 40B In the circumstances described in paragraph 40A, an entity shall present three balance sheets as at: (a) the end of the current period; (b) the end of the preceding period; and (c) the beginning of the preceding period. 40C When an entity is required to present an additional balance sheet in accordance with paragraph 40A, it must disclose the information required by paragraphs 41- 44 and Ind AS 8. Howeve .....

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ssification is impracticable. When an entity reclassifies comparative amounts, it shall disclose (including as at the beginning of the preceding period): (a) the nature of the reclassification; (b) the amount of each item or class of items that is reclassified; and (c) the reason for the reclassification. 42 When it is impracticable to reclassify comparative amounts, an entity shall disclose: (a) the reason for not reclassifying the amounts, and (b) the nature of the adjustments that would have .....

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lows reclassification, and it may be impracticable to recreate the information. 44 Ind AS 8 sets out the adjustments to comparative information required when an entity changes an accounting policy or corrects an error. Consistency of presentation 45 An entity shall retain the presentation and classification of items in the financial statements from one period to the next unless: (a) it is apparent, following a significant change in the nature of the entity s operations or a review of its financi .....

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f the changed presentation provides information that is reliable and more relevant to users of the financial statements and the revised structure is likely to continue, so that comparability is not impaired. When making such changes in presentation, an entity reclassifies its comparative information in accordance with paragraphs 41 and 42. Structure and content Introduction 47 This Standard requires particular disclosures in the balance sheet or in the statement of profit and loss, or in the sta .....

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e made in the financial statements. Identification of the financial statements 49 An entity shall clearly identify the financial statements and distinguish them from other information in the same published document. 50 Ind ASs apply only to financial statements, and not necessarily to other information presented in an annual report, a regulatory filing, or another document. Therefore, it is important that users can distinguish information that is prepared using Ind ASs from other information tha .....

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f an individual entity or a group of entities; (c) the date of the end of the reporting period or the period covered by the set of financial statements or notes; (d) the presentation currency, as defined in Ind AS 21; and (e) the level of rounding used in presenting amounts in the financial statements. 52 An entity meets the requirements in paragraph 51 by presenting appropriate headings for pages, statements, notes, columns and the like. Judgement is required in determining the best way of pres .....

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rounding and does not omit material information. Balance Sheet Information to be presented in the balance sheet 54 5[54 The balance sheet shall include line items that present the following amounts:] (a) property, plant and equipment; (b) investment property; (c) intangible assets; (d) financial assets (excluding amounts shown under (e), (h) and (i)); (e) investments accounted for using the equity method; (f) biological assets within the scope of Ind AS 41 Agriculture; (g) inventories; (h) trad .....

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deferred tax assets, as defined in Ind AS 12; (p) liabilities included in disposal groups classified as held for sale in accordance with Ind AS 105; (q) non-controlling interests, presented within equity; and (r) issued capital and reserves attributable to owners of the parent. 6[55 An entity shall present additional line items (including by disaggregating the line items listed in paragraph 54), headings and subtotals in the balance sheet when such presentation is relevant to an understanding o .....

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otals required in Ind AS for the balance sheet.] 56 When an entity presents current and non-current assets, and current and non-current liabilities, as separate classifications in its balance sheet, it shall not classify deferred tax assets (liabilities) as current assets (liabilities). 57 This Standard does not prescribe the order or format in which an entity presents items. Paragraph 54 simply lists items that are sufficiently different in nature or function to warrant separate presentation in .....

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For example, a financial institution may amend the above descriptions to provide information that is relevant to the operations of a financial institution. 58 An entity makes the judgement about whether to present additional items separately on the basis of an assessment of: (a) the nature and liquidity of assets; (b) the function of assets within the entity; and (c) the amounts, nature and timing of liabilities. 59 The use of different measurement bases for different classes of assets suggests .....

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liquidity provides information that is reliable and more relevant. When that exception applies, an entity shall present all assets and liabilities in order of liquidity. 61 Whichever method of presentation is adopted, an entity shall disclose the amount expected to be recovered or settled after more than twelve months for each asset and liability line item that combines amounts expected to be recovered or settled: (a) no more than twelve months after the reporting period, and (b) more than twelv .....

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es that are due for settlement within the same period. 63 For some entities, such as financial institutions, a presentation of assets and liabilities in increasing or decreasing order of liquidity provides information that is reliable and more relevant than a current/non-current presentation because the entity does not supply goods or services within a clearly identifiable operating cycle. 64 In applying paragraph 60, an entity is permitted to present some of its assets and liabilities using a c .....

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ties. Financial assets include trade and other receivables, and financial liabilities include trade and other payables. Information on the expected date of recovery of non-monetary assets such as inventories and expected date of settlement for liabilities such as provisions is also useful, whether assets and liabilities are classified as current or as noncurrent. For example, an entity discloses the amount of inventories that are expected to be recovered more than twelve months after the reporti .....

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months after the reporting period. An entity shall classify all other assets as non-current. 67 This Standard uses the term non-current to include tangible, intangible and financial assets of a long-term nature. It does not prohibit the use of alternative descriptions as long as the meaning is clear. 68 The operating cycle of an entity is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. When the entity s normal operating cycle is not c .....

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of noncurrent financial assets. Current liabilities 69 An entity shall classify a liability as current when: (a) it expects to settle the liability in its normal operating cycle; (b) it holds the liability primarily for the purpose of trading; (c) the liability is due to be settled within twelve months after the reporting period; or (d) it does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period (see paragraph 73). Terms of .....

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ed more than twelve months after the reporting period. The same normal operating cycle applies to the classification of an entity s assets and liabilities. When the entity s normal operating cycle is not clearly identifiable, it is assumed to be twelve months. 71 Other current liabilities are not settled as part of the normal operating cycle, but are due for settlement within twelve months after the reporting period or held primarily for the purpose of trading. Examples are some financial liabil .....

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2 An entity classifies its financial liabilities as current when they are due to be settled within twelve months after the reporting period, even if: (a) the original term was for a period longer than twelve months, and (b) an agreement to refinance, or to reschedule payments, on a long-term basis is completed after the reporting period and before the financial statements are approved for issue. 73 If an entity expects, and has the discretion, to refinance or roll over an obligation for at least .....

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long-term loan arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on the reporting date, the entity does not classify the liability as current, if the lender agreed, after the reporting period and before the approval of the financial statements for issue, not to demand payment as a consequence of the breach. 75 However, an entity classifies the liability as non-current if the lender agreed by the end of the reporting period to pr .....

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d in subclassifications depends on the requirements of Ind ASs and on the size, nature and function of the amounts involved. An entity also uses the factors set out in paragraph 58 to decide the basis of subclassification. The disclosures vary for each item, for example: (a) items of property, plant and equipment are disaggregated into classes in accordance with Ind AS 16; (b) receivables are disaggregated into amounts receivable from trade customers, receivables from related parties, prepayment .....

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the statement of changes in equity, or in the notes: (a) for each class of share capital: (i) the number of shares authorised; (ii) the number of shares issued and fully paid, and issued but not fully paid; (iii) par value per share, or that the shares have no par value; (iv) a reconciliation of the number of shares outstanding at the beginning and at the end of the period; (v) the rights, preferences and restrictions attaching to that class including restrictions on the distribution of dividend .....

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period in each category of equity interest, and the rights, preferences and restrictions attaching to each category of equity interest. 80A If an entity has reclassified (a) a puttable financial instrument classified as an equity instrument, or (b) an instrument that imposes on the entity an obligation to deliver to another party a pro rata share of the net assets of the entity only on liquidation and is classified as an equity instrument between financial liabilities and equity, it shall discl .....

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ty shall present the following items, in addition to the profit or loss and other comprehensive income sections, as allocation of profit or loss and other comprehensive income for the period: (a) profit or loss for the period attributable to: (i) non-controlling interests, and (ii) owners of the parent. (b) comprehensive income for the period attributable to: (i) non-controlling interests, and (ii) owners of the parent. Information to be presented in the profit or loss section of the statement o .....

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irment gains) determined in accordance with Section 5.5 of Ind AS 109; (c) share of the profit or loss of associates and joint ventures accounted for using the equity method; (ca) if a financial asset is reclassified out of the amortised cost measurement category so that it is measured at fair value through profit or loss, any gain or loss arising from a difference between the previous amortised cost of the financial asset and its fair value at the reclassification date (as defined in Ind AS 109 .....

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nsive income section 8[82A The other comprehensive income section shall present line items for the amounts for the period of: (a) items of other comprehensive income (excluding amounts in paragraph (b)), classified by nature and grouped into those that, in accordance with other Ind ASs: (i) will not be reclassified subsequently to profit or loss; and (ii) will be reclassified subsequently to profit or loss when specific conditions are met. (b) the share of the other comprehensive income of assoc .....

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f profit and loss, when such presentation is relevant to an understanding of the entity s financial performance.] 10[85A When an entity presents subtotals in accordance with paragraph 85, those subtotals shall: (a) be comprised of line items made up of amounts recognised and measured in accordance with Ind AS; (b) be presented and labelled in a manner that makes the line items that constitute the subtotal clear and understandable; (c) be consistent from period to period, in accordance with parag .....

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predictability, disclosing the components of financial performance assists users in understanding the financial performance achieved and in making projections of future financial performance. An entity includes additional line items in the statement of profit and loss, and it amends the descriptions used and the ordering of items when this is necessary to explain the elements of financial performance. An entity considers factors including materiality and the nature and function of the items of .....

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period in profit or loss unless an Ind AS requires or permits otherwise. 89 Some Ind ASs specify circumstances when an entity recognises particular items outside profit or loss in the current period. Ind AS 8 specifies two such circumstances: the correction of errors and the effect of changes in accounting policies. Other Ind ASs require or permit components of other comprehensive income that meet the Framework s definition of income or expense to be excluded from profit or loss (see paragraph .....

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tive (b), it shall allocate the tax between the items that might be reclassified subsequently to the profit or loss section and those that will not be reclassified subsequently to the profit or loss section. 92 An entity shall disclose reclassification adjustments relating to components of other comprehensive income. 93 Other Ind ASs specify whether and when amounts previously recognised in other comprehensive income are reclassified to profit or loss. Such reclassifications are referred to in t .....

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luding them in total comprehensive income twice. 94 An entity may present reclassification adjustments in the statement of profit and loss or in the notes. An entity presenting reclassification adjustments in the notes presents the items of other comprehensive income after any related reclassification adjustments. 95 Reclassification adjustments arise, for example, on disposal of a foreign operation (see Ind AS 21) and when some hedged forecast cash flow affect profit or loss (see paragraph 6.5. .....

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asset is used or when it is derecognised (see Ind AS 16 and Ind AS 38). In accordance with Ind AS 109, reclassification adjustments do not arise if a cash flow hedge or the accounting for the time value of an option (or the forward element of a forward contract or the foreign currency basis spread of a financial instrument) result in amounts that are removed from the cash flow hedge reserve or a separate component of equity, respectively, and included directly in the initial cost or other carry .....

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able amount, as well as reversals of such write-downs; (b) restructurings of the activities of an entity and reversals of any provisions for the costs of restructuring; (c) disposals of items of property, plant and equipment; (d) disposals of investments; (e) discontinued operations; (f) litigation settlements; and (g) other reversals of provisions. 99 An entity shall present an analysis of expenses recognised in profit or loss using a classification based on the nature of expense method. 100 En .....

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urchases of materials, transport costs, employee benefits and advertising costs), and does not reallocate them among functions within the entity. This method is simple to apply because no allocations of expenses to functional classifications are necessary. An example of a classification using the nature of expense method is as follows: Revenue X Other income X Changes in inventories of finished goods and work in progress X Raw materials and consumables used X Employee benefits expense X Deprecia .....

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ttributable to owners of the parent and to noncontrolling interests; (b) for each component of equity, the effects of retrospective application or retrospective restatement recognised in accordance with Ind AS 8; (c) [Refer Appendix 1] (d) for each component of equity, a reconciliation between the carrying amount at the beginning and the end of the period, separately (as a minimum) disclosing changes resulting from: (i) profit or loss; (ii) other comprehensive income; (iii) transactions with own .....

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of changes in equity or in the notes, an analysis of other comprehensive income by item (see paragraph 106 (d) (ii)). 107 An entity shall present, either in the statement of changes in equity or in the notes, the amount of dividends recognised as distributions to owners during the period, and the related amount of dividends per share. 108 In paragraph 106, the components of equity include, for example, each class of contributed equity, the accumulated balance of each class of other comprehensive .....

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total amount of income and expense, including gains and losses, generated by the entity s activities during that period. 110 Ind AS 8 requires retrospective adjustments to effect changes in accounting policies, to the extent practicable, except when the transition provisions in another Ind AS require otherwise. Ind AS 8 also requires restatements to correct errors to be made retrospectively, to the extent practicable. Retrospective adjustments and retrospective restatements are not changes in e .....

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h flow information provides users of financial statements with a basis to assess the ability of the entity to generate cash and cash equivalents and the needs of the entity to utilise those cash flows. Ind AS 7 sets out requirements for the presentation and disclosure of cash flow information. Notes Structure 112 The notes shall: (a) present information about the basis of preparation of the financial statements and the specific accounting policies used in accordance with paragraphs 117-124; (b) .....

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e balance sheet and in the statement of profit and loss, and in the statements of changes in equity and of cash flows to any related information in the notes.] 12[114 Examples of systematic ordering or grouping of the notes include: (a) giving prominence to the areas of its activities that the entity considers to be most relevant to an understanding of its financial performance and financial position, such as grouping together information about particular operating activities; (b) grouping toget .....

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n the order in which each statement and each line item is presented; and (iv) other disclosures, including: (1) contingent liabilities (see Ind AS 37) and unrecognised contractual commitments; and (2) non-financial disclosures, eg the entity s financial risk management objectives and policies (see Ind AS 107).] 13[115. Omitted ] 116 An entity may present notes providing information about the basis of preparation of the financial statements and specific accounting policies as a separate section o .....

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realisable value, fair value or recoverable amount) because the basis on which an entity prepares the financial statements significantly affects users analysis. When an entity uses more than one measurement basis in the financial statements, for example when particular classes of assets are revalued, it is sufficient to provide an indication of the categories of assets and liabilities to which each measurement basis is applied. 15[119 In deciding whether a particular accounting policy should be .....

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llowed in Ind ASs. An example is disclosure of a regular way purchase or sale of financial assets using either trade date accounting or settlement date accounting (see Ind AS 109, Financial Instruments). Some Ind Ass specifically require disclosure of particular accounting policies, including choices made by management between different policies they allow. For example, Ind AS 16 requires disclosure of the measurement bases used for classes of property, plant and equipment.] 16[120. Omitted] 121 .....

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25), that management has made in the process of applying the entity s accounting policies and that have the most significant effect on the amounts recognised in the financial statements.] 123 In the process of applying the entity s accounting policies, management makes various judgements, apart from those involving estimations, that can significantly affect the amounts it recognises in the financial statements. For example, management makes judgements in determining: (a) [Refer Appendix 1] (b) w .....

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with paragraph 122 are required by other Ind ASs. For example, Ind AS 112, Disclosure of Interests in Other Entities, requires an entity to disclose the judgments it has made in determining whether it controls another entity. Ind AS 40, Investment Property, requires disclosure of the criteria developed by the entity to distinguish investment property from owner-occupied property and from property held for sale in the ordinary course of business, when classification of the property is difficult. .....

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d of the reporting period. 126 Determining the carrying amounts of some assets and liabilities requires estimation of the effects of uncertain future events on those assets and liabilities at the end of the reporting period. For example, in the absence of recently observed market prices, future-oriented estimates are necessary to measure the recoverable amount of classes of property, plant and equipment, the effect of technological obsolescence on inventories, provisions subject to the future ou .....

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As the number of variables and assumptions affecting the possible future resolution of the uncertainties increases, those judgements become more subjective and complex, and the potential for a consequential material adjustment to the carrying amounts of assets and liabilities normally increases accordingly. 128 The disclosures in paragraph 125 are not required for assets and liabilities with a significant risk that their carrying amounts might change materially within the next financial year if, .....

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ement makes about the future and about other sources of estimation uncertainty. The nature and extent of the information provided vary according to the nature of the assumption and other circumstances. Examples of the types of disclosures an entity makes are: (a) the nature of the assumption or other estimation uncertainty; (b) the sensitivity of carrying amounts to the methods, assumptions and estimates underlying their calculation, including the reasons for the sensitivity; (c) the expected re .....

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extent of the possible effects of an assumption or another source of estimation uncertainty at the end of the reporting period. In such cases, the entity discloses that it is reasonably possible, on the basis of existing knowledge, that outcomes within the next financial year that are different from the assumption could require a material adjustment to the carrying amount of the asset or liability affected. In all cases, the entity discloses the nature and carrying amount of the specific asset .....

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circumstances, of major assumptions concerning future events affecting classes of provisions. Ind AS 113, Fair Value Measurement, requires disclosure of significant assumptions (including the valuation technique(s) and inputs) the entity uses when measuring the fair values of assets and liabilities that are carried at fair value. Capital 134 An entity shall disclose information that enables users of its financial statements to evaluate the entity s objectives, policies and processes for managing .....

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titative data about what it manages as capital. Some entities regard some financial liabilities (eg some forms of subordinated debt) as part of capital. Other entities regard capital as excluding some components of equity (eg components arising from cash flow hedges). (c) any changes in (a) and (b) from the previous period. (d) whether during the period it complied with any externally imposed capital requirements to which it is subject. (e) when the entity has not complied with such externally i .....

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ments and how capital is managed would not provide useful information or distorts a financial statement user s understanding of an entity s capital resources, the entity shall disclose separate information for each capital requirement to which the entity is subject. Puttable financial instruments classified as equity 136A For puttable financial instruments classified as equity instruments, an entity shall disclose (to the extent not disclosed elsewhere): (a) summary quantitative data about the a .....

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the amount of dividends proposed or declared before the financial statements were approved for issue but not recognised as a distribution to owners during the period, and the related amount per share; and (b) the amount of any cumulative preference dividends not recognised. 138 An entity shall disclose the following, if not disclosed elsewhere in information published with the financial statements: (a) the domicile and legal form of the entity, its country of incorporation and the address of its .....

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endices which are the part of other Indian Accounting Standards and make reference to Ind AS 1. 1 Appendix A, Distributions of Non-cash Assets to Owners, contained in Ind AS 10, Events after the Reporting Period 2 Appendix A, Changes in Existing Decommissioning, Restoration and Similar Liabilities, contained in Ind AS 16, Property, Plant and Equipment 3 Appendix B, The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction, contained in Ind AS 19, Employee Benefits .....

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an Accounting Standard. The purpose of this Appendix is only to bring out the major differences, if any, between Indian Accounting Standard (Ind AS) 1 and the corresponding International Accounting Standard (IAS) 1, , issued by the International Accounting Standards Board. Comparison with IAS 1, 1. With regard to preparation of Statement of profit and loss, International Accounting Standard (IAS) 1, , provides an option either to follow the single statement approach or to follow the two statemen .....

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ph 10A has been modified. 2. Different terminology is used in Ind AS 1 eg, the term balance sheet is used instead of Statement of financial position and Statement of Profit and Loss is used instead of Statement of profit and loss and other comprehensive income . The words approval of the financial statements for issue have been used instead of authorisation of the financial statements for issue in the context of financial statements considered for the purpose of events after the reporting period .....

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1 permits the periodicity, for example, of 52 weeks for preparation of financial statements. As Ind AS 1 does not permit it, the same is deleted. However, paragraph number 37 has been retained in Ind AS 1 to maintain consistency with paragraph numbers of IAS 1. 5. Paragraph 99 of IAS 1 requires an entity to present an analysis of expenses recognised in profit or loss using a classification based on either their nature or their function within the equity. Ind AS 1 requires only nature-wise classi .....

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9-40 (iii) paragraph 81 (iv) paragraph 82(e) (v) paragraphs 82(f)-(i) (vi) paragraphs 83-84 (vii) paragraph 106(c) (viii) paragraph 123(a) (ix) paragraph 115 (x) paragraph 120] 7. Paragraph 29 and 31 dealing with materiality and aggregation has been modified to include words except when required by law . 8. Paragraph 106(d)(iv) of Ind AS 1 dealing with disclosures regarding reconciliation between the carrying amount at the beginning and the end of the period for each component of equity, has bee .....

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tuted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 before it was read as, (e) notes, comprising a summary of significant accounting policies and other explanatory information; and 2. Inserted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 3. Substituted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 before it was read as, 31 An entity need not provide a specific disclosure required by an Ind AS if the information is not material except when required by law. 4. Substituted vide F .....

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her transactions that do not generate revenue but are incidental to the main revenue-generating activities. An entity presents the results of such transactions, when this presentation reflects the substance of the transaction or other event, by netting any income with related expenses arising on the same transaction. For example: (a) an entity presents gains and losses on the disposal of non-current assets, including investments and operating assets, by deducting from the amount of consideration .....

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balance sheet shall include line items that present the following amounts: 6. Substituted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 before it was read as, 55 An entity shall present additional line items, headings and subtotals in the balance sheet when such presentation is relevant to an understanding of the entity s financial position. 7. Inserted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 8. Substituted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 before it was read .....

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tuted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 before it was read as, 85 An entity shall present additional line items, headings and subtotals in the statement of profit and loss, when such presentation is relevant to an understanding of the entity s financial performance. 10. Inserted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 11. Substituted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 before it was read as, 113 An entity shall present notes in a systematic manner. A .....

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iance with Ind ASs (see paragraph 16); (b) summary of significant accounting policies applied (see paragraph 117); (c) supporting information for items presented in the balance sheet, and in the statement of profit and loss, and in the statements of changes in equity and of cash flows, in the order in which each statement and each line item is presented; and (d) other disclosures, including: (i) contingent liabilities (see Ind AS 37) and unrecognised contractual commitments, and (ii) non-financi .....

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the statement of profit and loss and the latter relate to the balance sheet. Nevertheless, an entity retains a systematic structure for the notes as far as practicable. 14. Substituted vide F. No. 01/01/2009-CL-V(Part) - Dated 30-3-2016 before it was read as, 117 An entity shall disclose in the summary of significant accounting policies: (a) the measurement basis (or bases) used in preparing the financial statements, and (b) the other accounting policies used that are relevant to an understandi .....

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from alternatives allowed in Ind ASs. An example is disclosure of a regular way purchase or sale of financial assets using either trade date accounting or settlement date accounting (see Ind AS 109, Financial Instruments). Some Ind ASs specifically require disclosure of particular accounting policies, including choices made by management between different policies they allow. For example, Ind AS 16 requires disclosure of the measurement bases used for classes of property, plant and equipment. 1 .....

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