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About the author I-5
Preface to third edition I-7
Chapter-heads I-9
Comparative Summary between IND AS and AS I-43A Comparative Analysis of Schedule III both for (AS) and Ind (AS) I-125Comparison of Major Ind AS with other GAAPs I-155Comparison between ICDS, Ind AS and AS I-185
ChapTEr 1
fInancIal rePortIng In IndIa and frameworK for fInancIal rePortIng
1.1 advent of Financial reporting in India 1
1.2 Conceptual framework 3
1.3 Scope of the framework 3
1.4 Objective 4
1.5 Financial position 4
1.6 performance 5
1.7 Cash fl ows 5
1.8 Underlying assumptions of fi nancial statements 5
1.9 Qualitative characteristics of fi nancial statements 6
1.10 Elements of fi nancial statements 8
1.11 recognition of elements of fi nancial statements 10
1.12 Concepts of capital 12
I-13
CONTENTS
PAGE
CONTENTS I-14
ChapTEr 2
IndIan accountIng StandardS (Ind aS) Summary
2.1 applicability 13
2.2 Ind aS 1: presentation of Financial Statements 22
2.3 Ind aS 2 : Inventories 23
2.4 Ind aS 7 : Cash flow statements 24
2.5 Ind aS 8 : accounting policies, changes in accounting estimates and errors 25
2.6 Ind aS 10 : Events after the reporting period 25
2.7 Ind aS 12 : Income taxes 26
2.8 Ind aS 16 : (revised) property, plant & Equipment 27
2.9 Ind aS 17 : Leases 27
2.10 Ind aS 19 : Employee benefits 29
2.11 Ind aS 20 : accounting for Government grants 30
2.12 Ind aS 21 : The effects of changes in foreign exchange rates 31
2.13 Ind aS 23 : Borrowing costs 32
2.14 Ind aS 24 : related party disclosures 33
2.15 Ind aS 27 : Separate financial statements 34
2.16 Ind aS 28 : Investment in associates and Joint Ventures 34
2.17 Ind aS 29 : Financial reporting in hyperinflationary economies 35
2.18 Ind aS 32 : Financial Instruments : presentation 36
2.19 Ind aS 33 : Earnings per share 36
2.20 Ind aS 34 : Interim Financial reporting 37
2.21 Ind aS 36 : Impairment of assets 38
2.22 Ind aS 37 : provisions, contingent liabilities and contingent assets 39
2.23 Ind aS 38 : Intangible assets 39
2.24 Ind aS 40 : Investment property 40
2.25 Ind aS 41 : agriculture 41
2.26 Ind aS 101 : First time adoption of International Financial reporting Standards 41
PAGE
I-15 CONTENTS
2.27 Ind aS 102 : Share based payment 41
2.28 Ind aS 103 : Business Combinations 43
2.29 Ind aS 104 : Insurance contracts 44
2.30 Ind aS 105 : Non-current assets held for sale and discontinued operations 44
2.31 Ind aS 106 : Exploration for and Evaluation of mineral resources 45
2.32 Ind aS 107 : Financial instruments : Disclosures 46
2.33 Ind aS 108 : Operating Segments 47
2.34 Ind aS 109 : Financial instruments 48
2.35 Ind aS 110 : Consolidated Financial Statements 49
2.36 Ind aS 111 : Joint arrangements 50
2.37 Ind aS 112 : Consolidated Financial Statements : Disclosure requirements 51
2.38 Ind aS 113 : Fair value measurement 51
2.39 Ind aS 114 : regulatory Deferral accounts 52
2.40 Ind aS 115 : recognition of revenue on contracts with customers (for reference purposes only) 52
2.41 Ind aS 11 : Construction Contract 53
2.42 Ind aS 18 : revenue 53
ChapTEr 3
Ind aS 1 : PreSentatIon of fInancIal StatementS
3.1 Objectives 54
3.2 Scope 54
3.3 Definitions 55
3.4 purpose of Financial Statements 57
3.5 Components of Financial Statements 57
3.6 presentation of True and Fair View and compliance with Ind aSs 58
3.7 Departure from compliance of Ind aS 1 59
3.8 Going concern 59
3.9 accrual basis of accounting 60
3.10 Materiality and aggregation 60
PAGE
CONTENTS I-16
3.11 Offsetting 60
3.12 Frequency of reporting 61
3.13 Comparative information 61
3.14 reclassification 62
3.15 Consistency of presentation 62
3.16 Identification of the financial statements 63
3.17 Balance Sheet 63
3.18 Distinction between Current/non-current 64
3.19 Current assets 64
3.20 Current liabilities 65
3.21 Information to be presented either in the balance sheet or in the notes 65
3.22 Statement of profit and Loss 66
3.23 Statement of changes in equity 70
3.24 Statement of cash flows 70
3.25 Notes on accounts 71
3.26 Disclosure requirements 71
3.27 appendix a to this Standard 74
3.28 Convergence with IaS/IFrSs 75
3.29 Financial reporting requirements as per Companies act, 2013 76
3.30 amendment under Companies (Indian accounting Standards) (amendment) rules, 2016 101
3.31 Case Study 105
ChapTEr 4
Ind aS 2 : InventorIeS
4.1 Objective 107
4.2 Scope 107
4.3 Exclusion 107
4.4 Definitions 108
4.5 recognition principle 109
4.6 Measurement of inventories 108
PAGE
I-17 CONTENTS
4.7 Cost of inventories 109
4.8 Costs excluded from valuation of inventories 111
4.9 Borrowing costs and inventories 112
4.10 Inventories purchased on deferred settlement terms 112
4.11 Cost of agricultural produce harvested from biological assets 112
4.12 Techniques for the measurement of cost 113
4.13 Inventories : Cost formulae 113
4.14 Net realisable Value 113
4.15 recognition as an expense 114
4.16 Disclosure requirements according to para 36 of Ind aS 2 114
4.17 Case studies 115
4.18 Companies (Indian accounting Standards) (amendment) rules, 2016 118
ChapTEr 5
Ind aS 7 : caSh flow Statement
5.1 Objective 120
5.2 Scope 120
5.3 Benefits of cash flow information 121
5.4 Definitions 121
5.5 Cash and cash equivalents 122
5.6 presentation of a Cash Flow Statement 122
5.7 reporting Cash Flows from Operating activities 124
5.8 reporting Cash Flows from Investing and Financing activities 125
5.9 reporting Cash Flows on a Net Basis 125
5.10 Cash flows for Financial institutions 126
5.11 Foreign currency Cash flows 126
5.12 Interest and dividends 126
5.13 Taxes on income 127
5.14 Investments in Subsidiaries, associates and Joint Ventures 127
5.15 Changes in ownership interests in subsidiaries and other businesses 127
PAGE
CONTENTS I-18
5.16 Non-cash transactions 128
5.17 Disclosure requirements 129
5.18 Convergence with International Finance reporting Standards 130
5.19 Case studies 130
ChapTEr 6
Ind aS 8 : accountIng PolIcIeS, accountIng eStImateS and errorS
6.1 Objective 137
6.2 Scope 137
6.3 Definitions 138
6.4 accounting policies 140
6.5 accounting estimates 147
6.6 accounting Errors 148
6.7 Convergence with IaS/IFrSs 150
6.8 Case studies 151
ChapTEr 7
Ind aS 10 : eventS occurrIng after the rePortIng PerIod
7.1 Objective 158
7.2 Scope 158
7.3 Definitions 159
7.4 adjusting events after the reporting period 160
7.5 Non-adjusting events after the reporting period 161
7.6 Dividends 162
7.7 Going concern 162
7.8 Disclosure requirements 163
7.9 Non-adjusting events after the reporting period - Examples 163
7.10 Distribution of non-cash assets to owners (appendix a to Ind aS 10) 164
PAGE
I-19 CONTENTS
7.11 Convergence with IaS/IFrSs 167
7.12 Decision free : Events occurring after the reporting date 167
7.13 Case studies 167
ChapTEr 8
Ind aS 12 : Income taxeS
8.1 Objective 171
8.2 Scope 171
8.3 Definitions 171
8.4 Tax base 172
8.5 recognition of current tax liabilities and current tax assets 178
8.6 Deferred tax assets and liabilities 178
8.7 recognition of deferred tax liabilities and deferred tax assets 179
8.8 Unused tax losses and unused tax credits 186
8.9 reassessment of unrecognised deferred tax assets 187
8.10 Investments in subsidiaries, branches and associates and interests in joint arrangements 187
8.11 Measurement 187
8.12 recognition of current and deferred tax 191
8.13 Deferred tax on business combination 192
8.14 Current and deferred tax on share based payments 192
8.15 Offset of current tax assets and liabilities 193
8.16 Offset of deferred tax assets and liabilities 193
8.17 Exchange differences on deferred foreign tax liabilities or assets 193
8.18 Disclosure requirements 194
8.19 Income Taxes - Changes in the Tax Status of an Entity or its Shareholders (appendix a) 195
8.20 Decision tree 196
8.21 Convergence with IaS/IFrSs 197
8.22 Case studies 197
PAGE
CONTENTS I-20
8.23 Companies (Indian accounting Standards) (amendment) rules, 2016 209
ChapTEr 9
Ind aS 16 : ProPerty, Plant and equIPment
9.1 Objective 210
9.2 Scope 210
9.3 Definitions 211
9.4 recognition of non-current assets 212
9.5 recognition and measurement 213
9.6 Elements of measurement of initial costs 213
9.7 Elements of costs not to be included as per Ind aS 16 (examples) 215
9.8 Bearer plants 216
9.9 Subsequent measurement 217
9.10 Depreciation 222
9.11 Depreciable amount 223
9.12 Depreciation methods 224
9.13 Depreciation calculation after revaluation 224
9.14 De-recognition of property, plant and Equipment 225
9.15 Disclosure requirements (para 73 of Ind aS 16) 226
9.16 Changes in Existing Decommissioning, restoration and Similar Liabilities 228
9.17 Stripping Costs in the production phase of a Surface Mine (appendix B) 230
9.18 Convergence with IaS/IFrS (Comparison of IaS 16, IFrIC 1 and IFrIC 20) 232
9.19 Case studies 232
9.20 Depreciation charge as per Companies act, 2013 (Section 123 & Schedule II) 244
9.21 Companies (Indian accounting Standards) (amendment) rules, 2016 245
PAGE
I-21 CONTENTS
ChapTEr 10
Ind aS 17 : leaSeS
10.1 Objective 246
10.2 Scope 246
10.3 Definitions 247
10.4 Classification of leases 250
10.5 Combined lease of land and building 252
10.6 Finance lease 252
10.7 Operating Lease 256
10.8 Sale and leaseback transactions 258
10.9 Operating Leases - Incentives (appendix a to Ind aS 17) 260
10.10 Evaluating the Substance of Transactions Involving the Legal Form of a Lease (appendix B to Ind aS 17) 260
10.11 Determining whether an arrangement contains a lease (appendix C to Ind aS 17) 263
10.12 Convergence with IaS/IFrSs (IaS 17, SIC 15, SIC 27 and IFrIC 4) 269
10.13 Case studies 269
10.14 Companies (Indian accounting Standards) (amendment) rules, 2016 283
ChapTEr 11
Ind aS 19 : emPloyee benefItS
11.1 Objective 284
11.2 Scope 284
11.3 Definitions 285
11.4 Categories of employee benefits 289
11.5 The Limit on a Defined Benefit asset, Minimum Funding requirements and their Interaction (appendix B to Ind aS 19) 311
11.6 Convergence with IaS/IFrSs (IaS 19 and IFrIC 14) 313
11.7 Case Studies 314
PAGE
CONTENTS I-22
11.8 Companies (Indian accounting Standards) (amendment) rules, 2016 320
ChapTEr 12
Ind aS 20 : accountIng for government grantS
12.1 Scope 322
12.2 Definitions 322
12.3 Government grants 323
12.4 Non-monetary Government grants 324
12.5 presentation of grants related to assets 324
12.6 presentation of grants related to income 324
12.7 repayment of Government Grants 325
12.8 Disclosure 325
12.9 Government assistance - No Specific relation to Operating activities (appendix a to Ind aS 20) 325
12.10 Convergence with IaS/IFrSs (Comparison with IaS 20 and SIC 10) 326
12.11 Case studies 327
ChapTEr 13
Ind aS 21 : effectS of change In foreIgn exchange
13.1 Objective 332
13.2 Scope 332
13.3 Definitions 333
13.4 Functional currency 334
13.5 Monetary items 335
13.6 Non-monetary items 335
13.7 Foreign currency transactions 335
13.8 Exchange differences 336
13.9 Change in functional currency 337
13.10 Translation to presentation currency 337
PAGE
I-23 CONTENTS
13.11 Translation of a Foreign operations 338
13.12 Disposal or partial disposal of a foreign operation 338
13.13 Tax effects of all exchange differences 339
13.14 Disclosure 339
13.15 Convergence with IaS/IFrSs 340
13.16 Case studies 340
ChapTEr 14
Ind aS 23 : borrowIng coStS
14.1 Core principle 344
14.2 Scope 344
14.3 Definitions 344
14.4 recognition of borrowing costs 346
14.5 Borrowing Costs Eligible for Capitalisation 346
14.6 Commencement of capitalization - Conditions 347
14.7 Suspension of capitalization 347
14.8 Cessation of capitalization 347
14.9 accounting of borrowing costs 348
14.10 Disclosure 348
14.11 Convergence with IaS/IFrSs 349
14.12 Case studies 349
14.13 Companies (Indian accounting Standards) (amendment) rules, 2016 350
ChapTEr 15
related Party dIScloSureS
15.1 Objective 351
15.2 Scope 351
15.3 purpose of related party disclosures 352
15.4 Definitions 352
15.5 Following are not deemed to be related 354
PAGE
CONTENTS I-24
15.6 Disclosures 354
15.7 Convergence with IaS/IFrSs 357
15.8 Case studies 357
ChapTEr 16
Ind aS 27 : SeParate fInancIal StatementS
16.1 Objective 359
16.2 Scope 359
16.3 Definitions 359
16.4 preparation of separate financial statements 360
16.5 Disclosure 362
16.6 Convergence with IFrS (Comparison with IaS 27 Separate Financial Statements) 363
ChapTEr 17
Ind aS 28 : InveStment In aSSocIateS and JoInt ventureS
17.1 Objective 365
17.2 Scope 365
17.3 Definitions 365
17.4 Significant influence 366
17.5 Equity method 367
17.6 Exemptions to Equity method 368
17.7 procedure for the equity method 369
17.8 Treatment of unrealised intra-group profits related to associates 371
17.9 accounting treatment of goodwill, bargain purchases and losses with respect to associates 372
17.10 Financial statements are prepared at different dates 373
17.11 Classification as held for sale 373
17.12 Discontinuing the use of Equity method 374
17.13 Change in ownership interest 375
PAGE
I-25 CONTENTS
17.14 Impairment losses 375
17.15 Separate financial statements 377
17.16 Convergence with IFrS (Comparison with IaS 28) 377
17.17 Companies (Indian accounting Standards) (amendment) rules, 2016 377
ChapTEr 18
Ind aS 29 : fInancIal rePortIng In the hyPerInflatIonary economIeS
18.1 Scope 379
18.2 restatement of historical cost financial statements 380
18.3 Taxes 383
18.4 Statement of cash flows 383
18.5 Corresponding figures 383
18.6 Consolidated financial statements 383
18.7 Selection and use of General price Index 384
18.8 Economies ceasing to be hyperinflationary 384
18.9 Disclosures 384
18.10 applying the restatement approach under Ind aS 29 Financial reporting in hyperinflationary Economies (appendix a to Ind aS 29) 385
18.11 Convergence with IaS/IFrS (Comparison with IaS 29, Financial reporting in hyperinflationary Economies and IFrIC 7) 386
ChapTEr 19
Ind aS 32 : fInancIal InStrumentS : PreSentatIon
19.1 Objective 387
19.2 Scope 387
19.3 Definitions 389
19.4 presentation 394
19.5 puttable instruments 394
PAGE
CONTENTS I-26
19.6 No contractual obligation to deliver cash or another financial asset [paragraph 16(a)] 398
19.7 Substance over legal form 398
19.8 Settlement in the entity’s own equity instruments 400
19.9 Contingent settlement provisions 402
19.10 Settlement options 402
19.11 Compound Financial Instruments 403
19.12 Treasury shares 403
19.13 Interest, dividends, losses and gains 403
19.14 Offsetting a financial asset and a financial liability 403
19.15 Convergence with IFrS (Comparison with IaS 32, Financial Instruments : presentation) 404
19.16 Companies (Indian accounting Standards) (amendment) rules, 2016 405
ChapTEr 20
Ind aS 33 : earnIngS Per Share
20.1 Objective 406
20.2 Scope 406
20.3 Definitions 407
20.4 Measurement 407
20.5 presentation 414
20.6 Disclosure 415
20.7 Convergence with IaS/IFrS 416
20.8 Case studies 417
ChapTEr 21
Ind aS 34 : InterIm fInancIal rePortIng
21.1 Objective 425
21.2 Scope 425
21.3 Definitions 426
21.4 Contents of an interim financial report 426
PAGE
I-27 CONTENTS
21.5 Minimum components of an interim financial report 426
21.6 Form and content of interim financial statements 427
21.7 Significant events and transactions 427
21.8 Other disclosures 428
21.9 Disclosure of compliance with Ind aSs 430
21.10 periods for which interim financial statements are required to be presented 430
21.11 Materiality 431
21.12 Disclosure in annual financial statements 431
21.13 recognition and measurement 431
21.14 Interim Financial reporting and Impairment (appendix a to Ind aS 34) 432
21.15 Convergence with IaS/IFrSs 433
21.16 Companies (Indian accounting Standards) (amendment) rules, 2016 434
21.17 Ind aS 24 : related parties 435
ChapTEr 22
Ind aS 36 : ImPaIrment of aSSetS
22.1 Objective 436
22.2 Scope 436
22.3 Definitions 438
22.4 Identifying an asset that may be Impaired 439
22.5 Indication of potential for impairment loss 440
22.6 Measurement of recoverable amount 441
22.7 Composition of estimates of future cash flows 443
22.8 Discount rate 444
22.9 recognition and Measurement of an Impairment Loss 445
22.10 What is a Cash Generating Unit 450
22.11 Identification of Cash-Generating Unit to which an asset belongs 450
22.12 recoverable amount and Carrying amount of a Cash Generating Unit 451
PAGE
CONTENTS I-28
22.13 Goodwill 453
22.14 Corporate assets 454
22.15 Impairment loss of a Cash Generating Unit 454
22.16 reversal of Impairment loss 456
22.17 reversal of Impairment loss of an individual asset 456
22.18 reversal of Impairment loss of a Cash Generating Unit 457
22.19 reversing an impairment loss for goodwill 457
22.20 Decision Tree 457
22.21 Disclosure 458
22.22 appendix a to this Standard discusses use of present value techniques to value in use 463
22.23 appendix C to this Standard discusses Impairment testing cash-generating units with goodwill and non-controlling interests 463
22.24 Convergence with IFrS (Comparison of IaS 36, Impairment of assets) 463
22.25 Case studies 464
ChapTEr 23
Ind aS 37 : ProvISIonS, contIngent lIabIlItIeS and contIngent aSSetS
23.1 Need for this standard 479
23.2 Objective 479
23.3 Scope 479
23.4 Definitions 480
23.5 recognition of provisions 481
23.6 Contingent liabilities 484
23.7 Contingent asset 485
23.8 Future operating losses 485
23.9 Onerous Contract (OC) 485
23.10 restructuring 486
23.11 Disclosure 487
PAGE
I-29 CONTENTS
23.12 rights to Interests arising from Decommissioning, restoration and Environmental rehabilitation Funds (appendix a to Ind aS 37) 488
23.13 Liabilities arising from participating in a Specific Market - Waste Electrical and Electronic Equipment (appendix B to Ind aS 37) 491
23.14 Levies (appendix C to Ind aS 37) 492
23.15 Convergence with IFrS (Comparison with IaS 37) provisions, Contingent Liabilities and Contingent assets, IFrIC 5, IFrIC 6 and IFrIC 21) 494
23.16 Case studies 494
23.17 Companies (Indian accounting Standards) (amendment) rules, 2016 510
ChapTEr 24
Ind aS 38 : IntangIble aSSetS
24.1 Objective 512
24.2 Scope 512
24.3 Definitions 514
24.4 Intangible assets : principles of recognition 515
24.5 Categories of Intangible assets 517
24.6 Measurement 518
24.7 Goodwill 526
24.8 Subsequent Measurement 528
24.9 Useful life 529
24.10 Intangible assets with finite useful lives 530
24.11 Intangible assets with indefinite useful lives 531
24.12 recoverability of the Carrying amount - Impairment Losses 531
24.13 retirements and Disposals 532
24.14 Disclosure requirements 533
24.15 Decision Tree 535
24.16 Intangible assets - Web Site Costs (appendix a to Ind aS 38) 535
24.17 Convergence with IFrS (Comparison with IaS 38 and SIC 32) 538
PAGE
CONTENTS I-30
24.18 Case studies 539
24.19 Companies (Indian accounting Standards) (amendment) rules, 2016 545
ChapTEr 25
Ind aS 40 : InveStment ProPerty
25.1 Scope 547
25.2 Exclusions 547
25.3 Definitions 548
25.4 Classification of property as investment property or owner-occupied property 548
25.5 recognition 549
25.6 Measurement 550
25.7 Transfers 553
25.8 Disposals 553
25.9 Disclosure 554
25.10 Convergence with IaS/IFrSs (Comparison with IaS 40) 556
25.11 Companies (Indian accounting Standards) (amendment) rules, 2016 557
ChapTEr 26
Ind aS 41 : agrIculture
26.1 Objective 558
26.2 Scope 558
26.3 Definitions 559
26.4 recognition and measurement 561
26.5 Gains and losses 562
26.6 Inability to measure fair value reliably 563
26.7 Government grants 563
26.8 Disclosure 564
PAGE
I-31 CONTENTS
ChapTEr 27
Ind aS 101 : fIrSt tIme adoPtIon of InternatIonal fInancIal
rePortIng StandardS
27.1 Objective 567
27.2 Scope 567
27.3 recognition and measurement 568
27.4 presentation and disclosure 570
27.5 appendix a to this Standard has summarised all the defined terms used across this Ind aS 574
27.6 appendix B to this Standard discusses exceptions to the retrospective application of other Ind aSs 574
27.7 appendix C Exemptions for business combinations 575
27.8 appendix D: Exemption to other Ind aSs 576
27.9 Convergence with IFrS (Major difference between Ind aS 101 and IFrS 1) 577
27.10 Companies (Indian accounting Standards) (amendment) rules, 2016 579
ChapTEr 28
Ind aS 102 : Share baSed Payment
28.1 Objective 581
28.2 Scope 581
28.3 recognition 582
28.4 Equity-settled share-based payment transaction 583
28.5 Cash-settled share-based payment transaction 587
28.6 Share-based payment transactions with cash alternatives 587
28.7 Share based payment transactions among group entities 588
28.8 accounting for Share-based payment transactions 589
28.9 Disclosures 590
PAGE
CONTENTS I-32
28.10 appendix a to this Standard provides definitions on terms related to this Standard 592
28.11 appendix B to this Standard provides application Guidance linked to this Standard 592
28.12 Convergence with IFrS (Comparison with IFrS 2 Share based payment) 592
28.13 Case studies 593
ChapTEr 29
Ind aS 103 : buSIneSS combInatIonS
29.1 Objective 606
29.2 Scope and exclusion 606
29.3 Identifying a business combination 607
29.4 The acquisition method 607
29.5 Disclosure 614
29.6 appendix a to this Standard provides Defined terms used in this Standard 615
29.7 appendix B to this Standard provides application guidance related to this Standard 615
29.8 Business combinations of entities under common control (appendix C to Ind aS 103) 615
29.9 Convergence with IFrS (Comparison with IFrS 3) 618
29.10 Case studies : Business Combinations 618
29.11 Companies (Indian accounting Standards) (amendment) rules, 2016 630
ChapTEr 30
Ind aS 104 : InSurance contract
30.1 Objective 631
30.2 Scope 631
30.3 Salient features 632
30.4 Disclosure 638
PAGE
I-33 CONTENTS
30.5 appendix a to this Standard discusses defined terms used across the Standard 640
30.6 appendix B to this Standard discusses definition of an insurance contract 640
30.7 Convergence with IFrS 4 Insurance contracts 640
30.8 Companies (Indian accounting Standards) (amendment) rules, 2016 641
ChapTEr 31
Ind aS 105 : non-current aSSetS held for Sale and dIScontInued oPeratIonS
31.1 Objective 642
31.2 Scope 642
31.3 Classification of non-current assets (or disposal groups) held for sale or as held for distribution to owners 643
31.4 Non-current assets that are to be abandoned 644
31.5 Measurement of non-current assets (or disposal groups) classified as held for sale 644
31.6 recognition of impairment losses and reversals 646
31.7 Change to a plan of sale 646
31.8 presentation and disclosure 647
31.9 Schematic of measurement of non-current asset held for sale 650
31.10 appendix a to Ind aS 105 discusses defined terms used across the Standard 651
31.11 appendix B to Ind aS 105 enumerates application Supplement for Extension of the period required to complete a sale 651
31.12 Convergence with IFrS (Comparison with IFrS 5) 652
31.13 Case studies 653
31.14 Companies (Indian accounting Standards) (amendment) rules, 2016 665
PAGE
CONTENTS I-34
ChapTEr 32
Ind aS 106 : exPloratIon and evaluatIon of mIneral reSourceS
32.1 Objective 668
32.2 Scope 668
32.3 recognition of Exploration and Evaluation assets 669
32.4 Measurement of Exploration and Evaluation assets 669
32.5 Subsequent measurement 670
32.6 Change in accounting policies 670
32.7 presentation 670
32.8 Impairment 671
32.9 Disclosure requirements 671
32.10 appendix a to Ind aS 106 discusses Defined Terms used across the Standard 671
32.11 Convergence with IFrS (Comparison with IFrS 6) 671
ChapTEr 33
Ind aS 107 : fInancIal InStrumentS : dIScloSureS
33.1 Objective 672
33.2 Scope 672
33.3 Disclosure requirements 674
33.4 Nature and extent of exposure to risks arising from financial instruments 683
33.5 appendix a to Ind aS 107 discusses defined terms used across the Standard 684
33.6 appendix B to Ind aS 107 provides application guidance related to this Standard 684
33.7 Convergence with IFrS (Comparison with IFrS 7) 684
33.8 Companies (Indian accounting Standards) (amendment) rules, 2016 685
PAGE
I-35 CONTENTS
ChapTEr 34
Ind aS 108 : oPeratIng SegmentS
34.1 Core principle 687
34.2 Scope 687
34.3 Operating segment 687
34.4 reportable segment 688
34.5 Disclosure requirements 692
34.6 Comparison with IFrS 8, operating segments 694
34.7 Case study 695
ChapTEr 35
Ind aS 109 : fInancIal InStrumentS
35.1 Objective 697
35.2 Scope 697
35.3 recognition and derecognition 700
35.4 analysis of financial instruments whether debt or equity 713
35.5 Derivative 714
35.6 reclassification 719
35.6a Gains and losses of financial assets and financial liabilities 721
35.7 hedge accounting 723
35.8 Interest rate swaps 725
35.9 appendix a to Ind aS 109 contains defined terms used across the Standard 726
35.10 appendix B to Ind aS 109 provides application guidance to this Standard 726
35.11 appendix C : hedges of a Net Investment in a Foreign Operation 726
35.12 appendix D to Ind aS 109 - Extinguishing Financial Liabilities with Equity Instruments 729
35.13 Convergence with IFrS (Comparison with Ind aS 109) 730
35.14 Case studies 731
PAGE
CONTENTS I-36
35.15 Companies (Indian accounting Standards) (amendment) rules, 2016 746
ChapTEr 36
Ind aS 110 : conSolIdated fInancIal StatementS
36.1 Objective 749
36.2 Scope 750
36.3 Concept of group 750
36.4 Concept of control 751
36.5 Consolidated financial statements 755
36.6 Objectives of preparing consolidated financial statements 755
36.7 Circumstances when subsidiaries should be excluded from consolidated financial statements 756
36.8 Need for using coterminous year-ends and uniform accounting policies when preparing consolidated financial statements and how is it achieved in practical world 757
36.9 process followed in summary for consolidation of parent with subsidiaries 757
36.10 purchase consideration 762
36.11 Non-controlling Interest (NCI) 764
36.12 Measurement and recognition of goodwill in consolidated financial statements 766
36.13 Treatment for acquisition related costs 767
36.14 Measurement of contingent liabilities in business combination 767
36.15 accounting treatment of pre-acquisition and post-acquisition profit 768
36.16 Consolidated income statement 772
36.17 Consolidated statement of changes in equity 775
36.18/ Treatment of unrealised profit related to inventories in19 preparation of consolidated financial statements 776
PAGE
I-37 CONTENTS
36.20 Treatment of unrealised profit related to sale of non-current assets in preparation of consolidated financial statements 785
36.21 Treatment of intra-group interest expense 787
36.22 Treatment of intra-group dividends 787
36.23 Treatment of fair value in the consideration paid for a subsidiary as well as in determining subsidiary’s identifiable assets and liabilities when preparing consolidated financial statements 791
36.24 partial disposal of an investment in a subsidiary 797
36.25 appendix a to Ind aS 110 discusses Defined terms used across the Standard 797
36.26 appendix B to Ind aS 110 provides application guidance 797
36.27 Convergence with IFrS (Comparison with IFrS 10) 797
36.28 Case studies on the overall definition of control 798
36.29 Companies (Indian accounting Standards) (amendment) rules, 2016 811
ChapTEr 37
Ind aS 111 : JoInt arrangementS
37.1 Objective 813
37.2 Scope 813
37.3 Definitions (appendix a to Ind aS 111) 813
37.4 Major changes highlighted in Ind aS 111 related to Joint venture accounting 814
37.5 Joint arrangement 815
37.6 Types of Joint arrangement 815
37.7 Comparative accounting treatment related to types of joint arrangements 815
37.8 Decision tree on assessing Joint control 818
37.9 Classification of a joint arrangement: assessment of the parties’ rights and obligations arising from the arrangement 818
37.10 Comparative analysis of the various entities in consolidation of financial statements 819
PAGE
CONTENTS I-38
37.11 appendix B to Ind aS 111 provides application guidance 819
37.12 Convergence with IFrS (Comparison with IFrS 11) 819
37.13 Case studies 821
ChapTEr 38
Ind aS 112 : dIScloSure of IntereStS In other entItIeS
38.1 Objective 861
38.2 Scope 862
38.3 Definitions (appendix a to Ind aS 112) 862
38.4 Significant judgment and assumptions 863
38.5 Interest in subsidiaries by parent 864
38.6 The interest that non-controlling interests have in the group’s activities and cash flows 864
38.7 Consequences of changes in a parent’s ownership interest in a subsidiary during reporting period 865
38.8 Interests in unconsolidated subsidiaries (investment entities) 865
38.9 Interests in joint arrangements and associates 866
38.10 Interests in unconsolidated structured entities 868
38.11 appendix B to Ind aS 112 provides application guidance 868
38.12 Companies (Indian accounting Standards) (amendment) rules, 2016 869
ChapTEr 39
Ind aS 113 : faIr value meaSurement
39.1 Objective 870
39.2 Scope 870
39.3 Exclusion 870
39.4 Fair value measurement 871
39.5 Valuation techniques 875
39.6 Disclosure 880
PAGE
I-39 CONTENTS
39.7 appendix a to Ind aS 113 discusses defined terms which are used across the Ind aS 883
39.8 appendix B to Ind aS 113 provides application guidance 883
39.9 Convergence with IFrS (Comparison with IFrS 13) 883
39.10 Case study 883
ChapTEr 40
Ind aS 114 : regulatory deferral accountS
40.1 Objective 886
40.2 Scope 886
40.3 recognition, measurement, impairment and derecognition 887
40.4 presentation 887
40.5 Disclosure 888
40.6 appendix a to this Standard discusses the defined terms used across the Standard 891
40.7 appendix B to this Standard provides application Guidance of this Standard 891
40.8 Convergence with IFrS (Comparison with IFrS 14) 894
ChapTEr 41
Ind aS 115 : revenue from contractS wIth cuStomerS
41.1 Objective 895
41.2 Core principle 895
41.3 Scope 896
41.4 Definitions (appendix a to Ind aS 115) 896
41.5 recognition 897
41.6 Measurement 904
41.7 presentation 911
41.8 Disclosure 911
41.9 appendix B to Ind aS 115 provides application Guidance to the Standard 915
PAGE
CONTENTS I-40
ChapTEr 42
IndIan accountIng StandardS (Ind aS 11) conStructIon contract
42.1 Objective 920
42.2 Scope 920
42.3 Definitions 921
42.4 Combining and segmenting construction contracts 921
42.5 Contract revenue 922
42.6 Contract costs 924
42.7 recognition of contract revenue and expenses 925
42.8 percentage of completion method 926
42.9 recognition of expected losses 929
42.10 Changes in estimates 929
42.11 Disclosure 929
42.12 appendix a : Service Concession arrangements 930
42.13 appendix B : Service Concession arrangements: Disclosures 938
42.14 appendix C : references to matters contained in other Indian accounting Standards 940
42.15 appendix 1 940
ChapTEr 43
IndIan accountIng Standard (Ind aS) 18: revenue [aS Per comPanIeS (IndIan
accountIng StandardS) (amendment) ruleS, 2016]
43.1 Objective 942
43.2 Scope 943
43.3 Definitions 944
43.4 Measurement of revenue 944
43.5 Identification of the transaction 945
43.6 Sale of goods 946
43.7 rendering of services 948
PAGE
I-41 CONTENTS
43.8 Interest and royalties 950
43.9 Disclosure 950
43.10 appendix a : revenue—Barter Transactions Involving advertising Services 951
43.11 appendix B : Customer Loyalty programmes 952
43.12 appendix C : Transfers of assets from Customers 955
43.13 appendix D : references to matters contained in other Indian accounting Standards 958
43.14 appendix 1 959
43.15 Case study 960
