Components of Financial Statements

Following are the components of Financial Statements under Ind-AS and IGAAP:

Components of Financial Statements	Under Ind AS?	Under IGAAP
Balance Sheet as at end of the period	Yes	Yes
Statement of Profit and Loss for the period	Yes	Yes
Statement of Changes in Equity for the period	Yes	No
Statement of Cash Flow for the period	Yes	If applicable
Statement of Significant Accounting Policies	Yes	Yes
Notes to accounts and other explanatory notes	Yes	Yes

Synopsis of Material Differences to Key Ind-ASs vis-à-vis corresponding IGAAP

(Note: It is to be noted that the material presented below is a mere summary of the Standards and gives a broad overview of the same and does not cover all the Standards. The actual Standards are much more detailed in the nature and readers are advised to refer the same for a comprehensive understanding)

I. INCOME AND EXPENSES

REVENUE RECOGNITION

Ind-AS-115 Revenue from Contracts with Customers

(Significantly different from the corresponding AS-9 on Revenue Recognition and AS-7 on Construction Contracts)

Ind-AS-115 recommends a five step model to recognise revenue:

• Identify the contract with a customer
• Identify the performance obligations in the contract
• Determine the transaction price
• Allocate the transaction price to the performance obligations in the contract
• Recognise revenue when (or as) the entity satisfies the performance obligation by transferring a promised goods or services to a customer.

For each performance obligation, the entity should determine whether performance obligation is satisfied at a point of time or over time. If any of the conditions specified below are satisfied, performance obligation is satisfied over time (and revenue is recognized over time):

• Customer Simultaneously receives and consumes benefits provided by the entity’s performance as the entity performs;
• Entity’s performance creates or enhance an asset that the customer controls as the asset is created or enhanced;
• Entity’s performance does not create an asset with alternative use to the entity and the entity has enforceable right for performance completed to date.

An entity shall recognise the amount of allocated transaction price as revenue once a performance obligation is satisfied. Transaction price which can be a fixed or variable amount is determined based on the terms of contract and the entity’s customary practices.

Variable Consideration

If the consideration includes a variable amount, an entity should estimate the amount of consideration to which it will be entitled in exchange for transferring the promised goods or services to a customer.

The existence of a significant financing component

In determining the transaction price, an entity should adjust the promised amount of consideration for the time value of money if significant financing components exist.

Non-Cash Consideration

When customer promises to pay consideration other than in cash form, an entity should measure it at fair value. If fair value cannot be reasonably measured, then entity should measure the consideration indirectly by reference to the stand-alone selling price of the goods or service in exchange for consideration.

Consideration payable to Customer

Consideration payable to the customer includes cash amounts, credits or other items (voucher or coupon) and the entity accounts for it as a reduction of the transaction price (revenue). An entity should recognise the reduction of revenue when (or as) either of the following events occurs:

• Recognises revenue for the transfer of related goods or service to the customer
• Pays or promises to pay the consideration

Allocation of Transaction Price to Performance Obligation

Entity should allocate the transaction price to each performance obligation identified in a contract on a relative stand-alone selling price basis (It is the price at which an entity would sell a promised good or service separately to a customer). If this price is directly not available, it should be estimated using methods such as:

• The adjusted market assessment approach
• Expected cost plus margin approach
• Residual approach

Disclosures

Entity should disclose qualitative and quantitative information as indicated below:

Customer Contracts	Significant Judgments and changes made in applying this standard to those contracts	Any assets recognized from the cost to obtain or fulfill a contract with customers
Revenue recognized to be disclosed separately from its other sources of revenue	Explain the judgments used for determining timing for satisfaction of performance obligation and transaction price and amount allocated	Closing balance of asset recognized from cost
Any impairment loss recognized on any receivable or contract assets		Amount of amortization and any impairment loss recognized
A reconciliation of the contract price with the revenue recognised

AS-9- Revenue Recognition

Scope

AS-9 does not deal with the following:

• Revenue arising from construction contracts, hire-purchase and lease agreements;
• Revenue relating to government grants and other similar subsidies; and
• Revenue of insurance companies from insurance contracts.

Recognition Principles

Revenue from sale of goods and services should be recognised at the time of sale of goods or rendering of services if collection is reasonably certain; i.e., when risks and rewards of ownership are transferred to the buyer and when effective control of the seller as the owner is lost.

In case of rendering of services, revenue must be recognised either on completed service method or proportionate completion method by relating the revenue with work accomplished and certainty of consideration receivable.

Interest is recognised on time basis, royalties on accrual basis and dividend when owner’s right to receive payment is established.

Disclosures

Disclose circumstances in which revenue recognition has been postponed pending significant uncertainties.

AS 7 - Construction Contracts

Scope

The AS is applicable in accounting of contracts in the books of contractor. It is to be noted that this standard is not applicable for construction projects undertaken by the entity on behalf of its own. It is also not applicable to service contracts which are not related to construction of assets.

• Construction contract may be for construction of a single/combination of interrelated or interdependent assets.
• A fixed price contract is a contract where contract price is fixed or per unit rate is fixed and in some cases subject to escalation clause.
• A cost plus contract is a contract in which contractor is reimbursed for allowable or defined cost plus percentage of these cost or a fixed fee.
• In a contract covering a number of assets, each asset is treated as a separate construction contract when there are:
  • separate proposals;
  • subject to separate negotiations and the contractor and customer is able to accept/reject that part of the contract;
  • identifiable cost and revenues of each asset
• A group of contracts to be treated as a single construction contract when:
  • they are negotiated as a single package;
  • contracts are closely interrelated with an overall profit margin; and
  • contracts are performed concurrently or in a continuous sequence.
• Additional asset construction to be treated as separate construction contract when:
  • assets differs significantly in design/technology/function from original contract assets.
  • a price negotiated without regard to original contract price

Contract Revenue and Contract Costs

• Contract revenue comprises of:
  • initial amount and
  • variations in contract work, claims and incentive payments that will probably result in revenue and are capable of being reliably measured.
• Contract cost comprises of:
  • costs directly relating to specific contract
  • costs attributable and allocable to contract activity
  • other costs specifically chargeable to customer under the terms of contracts.
• Contract Revenue and Expenses to be recognised, when outcome can be estimated reliably up to stage of completion on reporting date.
• In Fixed Price Contract outcome can be estimated reliably when:
  • total contract revenue can be measured reliably
  • it is probable that economic benefits will flow to the enterprise;
  • contract cost and stage of completion can be measured reliably at the reporting date; and
  • contract costs are clearly identified and measured reliably for comparing actual costs with prior estimates.
• In cost plus contract outcome is estimated reliably when:
  • it is probable that economic benefits will flow to the enterprise; and
  • contract cost, whether reimbursable or not, can be clearly identified and measured reliably.
• When outcome of a contract cannot be estimated reliably:
  • revenue to the extent of which recovery of contract cost is probable should be recognised;
  • contract cost should be recognised as an expense in the period in which they are incurred; and
  • all foreseeable losses must be fully provided for.
• When uncertainties no longer exist, revenue and expenses to be recognised as mentioned above when outcomes can be estimated reliably.
• When it is probable that contract costs will exceed total contract revenue, the expected loss should be recognised as an expense immediately.
• Any changes in estimate to be accounted for as per AS 5.

Disclosures

• Contract revenue recognised in the period;
• Method used to determine recognised contract revenue;
• Methods used to determine the stage of completion of contracts in progress;
• Gross amount due from customers for contract work as an asset; and
• Gross amount due to customers for contract work as a liability.
• For contracts in progress:
  • the aggregate amount of costs incurred and recognised profits (less recognised losses) up to the reporting date;
  • amount of advances received; and
  • amount of retention.

Taxes on Income: Significant Differences between AS 22 and Ind AS 12

Topic	AS 22, Accounting for Taxes on Income	Ind AS 12, Income Taxes
Deferred tax assets/ liabilities	Entities are required to calculate the deferred tax assets/ liabilities using the profit and loss account approach, requiring recognition of tax effects of differences between taxable income and accounting income. For this purpose, differences between taxable income and accounting income are classified into: Timing differences being the differences between taxable income and accounting income for a period that originate in one period and are capable of reversal in one or more subsequent periods. Permanent differences which are the differences between taxable income and accounting income for a period that originate in one period and do not reverse subsequently.	Entities are required to calculate the deferred tax assets/ liabilities using the balance sheet method, focusing on temporary differences in the accounting for the expected future tax consequences of events. For this purpose, temporary differences are differences between the carrying amount of an asset or liability in the balance sheet and its tax base. Temporary differences may be either: Taxable temporary differences, which are temporary differences that will result in taxable amounts in future periods when the carrying amount of the asset or liability is recovered or settled. Deductible temporary differences, which are temporary differences that will result in amounts that are deductible in determining taxable profit (tax loss) of future periods when the carrying amount of the asset or liability is recovered or settled
Recognition of deferred taxes	Deferred taxes are generally recognized for all timing differences arising on differences in accounting and taxable income.	Deferred tax is recognized for all taxable temporary differences between accounting and tax base of an asset or liability except to the extent of those which arise from: initial recognition of goodwill or asset or liability in a transaction which: is not a business combination; and at the time of the transaction, affects neither the accounting nor the tax profit (tax loss).
Probable as against virtual certainty	With respect to unabsorbed depreciation or carry forward of losses under tax laws, deferred tax assets should be recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized. However, deferred tax asset for all other unused credits is recognized to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.	With respect to carry forward of unused tax losses and unused tax credits, a deferred tax asset shall be recognized to the extent that it is probable that future taxable profit will be available against which the unused tax losses and unused tax credits can be utilized.
Revaluation of assets	No deferred tax is to be recognized if assets (property, plant and equipment) are revalued since it is considered as a permanent difference.	In some jurisdictions, the revaluation or the restatement of an asset to fair value affects taxable profit (tax loss) for the current period. As a result, the tax base of the asset is adjusted, and no temporary difference arises. In other jurisdictions, the revaluation or restatement of an asset does not affect taxable profit in the period of the revaluation or restatement and consequently, the tax base of the asset is not adjusted. Nevertheless, the future recovery of the carrying amount will result in a taxable flow of economic benefits to the entity and the amount that will be deductible for the tax purposes will differ from the amount of those economic benefits. The difference between the carrying amount of a revalued asset and its tax base is a temporary difference and give rise to a deferred tax liability or asset.
Investment in subsidiaries, branches and associates and interest in joint ventures	No deferred tax required to be recognized in respect thereof. Deferred tax expense is an aggregate total from separate financials statements of each entity of the group with no adjustment on consolidation.	With respect to all taxable temporary differences, deferred tax liability is recognized on unrealised / accumulated profits, except to the extent that both of the following conditions are satisfied: The parent, the investor, the venture or joint operator is able to control timing of the reversal of the temporary difference, and It is probable that the temporary difference will not reverse in the foreseeable future.
Tax benefits related to share-based payments.	No equivalent guidance.	With respect to share based payments, deferred tax benefit is calculated based on the tax deduction for the share-based payment under the applicable tax law.
Changes in tax status of an entity or its shareholders.	No equivalent guidance.	Current tax and deferred tax consequences are required to be included in the statement of profit or loss of the period of change unless those consequences relate to transactions and events recognized outside the statement pf profit or loss either in other comprehensive income or directly in equity in the same or a different period.
Recognition of taxes on items recognized in other comprehensive income or directly in equity	No equivalent guidance. However, ICAI has issued an announcement in this regard. This announcement requires any expense charged directly to reserve and/or securities premium account to be net of benefits that arise from the admissibility of such expense for tax purpose. Similarly, any income credited directly to a reserve account should be net of its tax effect.	Current tax and deferred tax shall be recognized outside profit or loss if the tax relates to items that are recognized, in the same or a different period, outside profit or loss. Therefore, the tax on items recognized in the comprehensive income or in equity, is also recorded in other comprehensive income or in equity as appropriate.
Deferred tax in respect of business combination	No equivalent guidance.	Acquired deferred tax benefits recognized within the measurement period that result from new information about facts and circumstances that existed at the acquisition date shall be applied to reduce the carrying amount of any goodwill related to that acquisition. If the carrying amount of that goodwill is zero, any remaining deferred tax benefits shall be recognized in other comprehensive income and accumulated in equity as capital reserve or recognized directly in capital reserve. All other acquired deferred tax benefits realized shall be recognized in profit or loss (or, if Ind AS 12 so requires, outside profit or loss). An entity does not recognize deferred tax liabilities arising from the initial recognition of goodwill.
Tax holiday period	The deferred tax in respect of timing differences which reverse during the tax holiday period is not recognized to the extent the enterprise’s gross total income is subject to certain deduction during the tax holiday period as per the Income Tax, Act, 1961. In certain cases, the deferred tax in respect of timing differences which reverse during the tax holiday period is not recognized to the extent deduction from the total income of an enterprise is allowed during the tax holiday period. Deferred tax in respect of timing differences which reverse after the tax holiday period is recognized in the year in which the timing differences originate.	No equivalent guidance.
	However, recognition of deferred tax assets is subject to the consideration of prudence. For the above purposes, the timing differences which originate first are considered to reverse first.
Disclosures	These additional disclosures are not required.	A reconciliation between the income tax expense reported and the product of accounting profit multiplied by the applicable tax rate. Unrecognized deferred tax liability on undistributed earnings of subsidiaries, branches, associates & joint venture. Details of tax holidays and the expiry date thereof.

Borrowing Cost: Significant Differences between AS 16 and Ind AS 23

Topic	AS 16, Borrowing Cost	Ind AS 23, Borrowing Cost
Components of borrowing costs	Borrowing costs include: interest and commitment charges on bank borrowings; and other short-term and long-term borrowings; amortization of discounts or premiums relating to borrowings; amortization of ancillary costs incurred in connection with the arrangement of borrowings; finance charges in respect of assets acquired under finance leases or under other similar arrangements; and exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs.	Borrowing costs include: interest expense calculated using the effective interest method as described in Ind AS 109, Financial Instruments; finance charges in respect of finance leases recognized in accordance with Ind AS 116, Leases; and exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs.
Substantial period of time	A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. AS 16 provides that ordinarily, a period of 12 months is considered as substantial period of time unless a shorter or longer period can be justified on the basis of facts and circumstances of the case. In estimating the said period, time which an asset takes, technologically and commercially, to be ready for its intended use or sale is considered.	A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. However, Ind AS 23 does not provide any guidance on this term unlike AS 16.
Weighted average borrowing cost	No equivalent guidance	In some circumstances, it is appropriate to include all borrowings of the parent and its subsidiaries when computing a weighted average of the borrowing costs; in other circumstances, it is appropriate for each subsidiary to use a weighted average of the borrowing costs applicable to its own borrowings.
Disclosure	The financial statements should disclose: the accounting policy adopted for borrowing costs; and the amount of borrowing costs capitalized during the period.	An entity shall disclose: the amount of borrowing costs capitalized during the period; and the capitalization rate used to determine the amount of borrowing costs eligible for capitalization.

Employee Benefit Expenses: Significant Differences between AS 15 and Ind AS 19

Topic	AS 15, Employee Benefits	Ind AS 19, Employee Benefits
Definition of Employee	Employees includes only whole-time directors.	Employees include directors.
Actuarial valuation	The detailed actuarial valuation of the present value of defined benefit obligations may be made at intervals not exceeding three years. However, with a view that the amounts recognized in the financial statements do not differ materially from the amounts that would be determined at the balance sheet date, the most recent valuation is reviewed at the balance sheet date and updated to reflect any material transactions and other material changes in circumstances (including changes in interest rates) between the date of valuation and the balance sheet date. The fair value of any plan assets is determined at each balance sheet date.	Detailed actuarial valuation needs to be undertaken determine the present value of the net defined benefit liability (asset) is performed with sufficient regularity so that the amounts recognized in the financial statements do not differ materially from the amounts that would have been determined at the end of the reporting period. It however does not specify what constitutes sufficient regularity.
Actuarial gains and losses	All actuarial gains and losses should be recognized immediately in the statement of profit and loss.	Actuarial gains and losses representing changes in the present value of the defined benefit obligation resulting from experience adjustment and effects of changes in actuarial assumptions are recognized in other comprehensive income and not reclassified to profit or loss in a subsequent period.
Discount rate	Discount rate to be used for determining defined benefit obligation is by reference to market yields at the balance sheet date on government bonds of a currency and terms consistent with the currency and term of the post-employment benefit obligations.	The rate used to discount post- employment benefit obligations shall be determined by reference to market yields at the end of the reporting period on government bonds. However, requirements given in IAS 19 in this regard have been retained with appropriate modifications for currencies other than Indian rupee.
Defined benefit plans	The changes in defined benefit liability (surplus) has the following components: Service cost- recognized in profit or loss Interest cost- recognized in profit or loss The expected return on any plan assets -recognized in profit or loss; Net actuarial gains and losses recognized in profit or loss.	The change in the defined benefit liability (asset) has the following components: Service cost - recognized in profit or loss; Net interest cost (i.e. time value) on the net defined benefit deficit/(asset)- recognized in profit or loss; Re-measurement including: changes in fair value of plan assets that arise from factors other than time value; and actuarial gains and losses on obligations - recognized in other comprehensive income.
Past service cost and curtailments	Past service cost is recognized as under: As an expense on a straight-line basis over the average period until the benefits become vested. If benefits already vested recognized as an expense immediately entities recognize a curtailment when it occurs. However, when a curtailment is linked with restructuring it is accounted for at the same time as the related restructuring.	Past service cost (including curtailments) is recognized as an expense at the earlier of the following dates: when the plan amendment or curtailment occurs; and when the entity recognizes related restructuring costs or termination benefits.
Termination benefits	An enterprise should recognize termination benefits as a liability and an expense when, and only when: the enterprise has a present obligation as a result of a past event; it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and a reliable estimate can be made of the amount of the obligation.	An entity shall recognize a liability and expense for termination benefits at the earlier of the following dates: when the entity can no longer withdraw the offer of those benefits; and when the entity recognises costs for a restructuring that is within the scope of Ind AS 37 and involves the payment of termination benefits.

Effects of Changes in Foreign Exchange Rates: Significant Difference between AS 11 and Ind AS 21

Topic	AS 11, The Effects Changes in the Foreign Exchange Rates	Ind AS 21, The Effects of Changes in Foreign Exchange Rates
Functional and presentation currency	There is no concept of functional currency. AS-11 does not specify the currency in which an enterprise presents its financial statements. However, an enterprise normally uses the currency of the country in which it is domiciled. AS-11 defines the term ‘Foreign Currency’ as a currency other than the reporting currency which is the currency in which financial statements are presented	Functional currency is the currency of the primary economic environment in which the entity operates. Foreign currency is a currency other than the functional currency. Presentation currency is the currency in which the financial statements are presented. ·
Exchange differences	In general, exchange differences arising both on: Transactions settled during the period; and Upon re-translation of the monetary items at the balance sheet date are recorded in the profit and loss for the period. Long-term foreign currency monetary items: Exchange differences arising on reporting of long-term foreign currency monetary items at rates different from those at which they were initially recorded during the period or reported in previous financial statements, in so far as they relate to the acquisition of a depreciable capital asset, can be added to or deducted from the cost of the asset and shall be depreciated over the balance life of the asset and in other cases, can be accumulated in a “Foreign Currency Monetary Item. Translation Difference Account” in the financial statements and amortized over the balance period of such long-term asset/liability, by recognition as income or expense in each of such periods. There is no time limit for availing this option. Net investment in a non-integral foreign operation: Exchange differences on monetary financial items that in substance, form part of net investment non-integral foreign operation is recognised in the ‘Foreign Currency Translation Reserve ‘in the separate financial statements and recognised as income or expense at the time of disposal of operation.	In general, exchange differences arising both on: Transactions settled during the period; and Upon retranslation of the monetary items at the balance sheet date are recorded in the profit and loss for the period. Long-term foreign currency monetary items: With respect to exchange differences arising on reporting of long-term foreign currency monetary items, similar to Indian GAAP. an entity may continue the policy adopted for exchange differences arising from long term foreign currency monetary items recognised in the financial statements for the period ending immediately before the beginning of the first Ind AS financial reporting period as per the previous GAAP, However, this option is only available in respect of those long term foreign currency monetary items which are acquired on or before the date of convergence with Ind AS.
Translation in the consolidated financial statements	Translation of financial statement of foreign operation to the reporting currency of the parent/investor is dependent upon the classification of the said operation as integral or non-integral.	Assets and liabilities should be translated from functional currency to presentation currency at the closing rate at the date of the statement of financial position.
	Integral foreign operation: Monetary assets are translated at closing rate. Non-monetary items are translated at historical rate if they are valued at cost. Non-monetary items which are carried at fair value or other valuation basis are reported using closing rate. Income and expense items are translated at historical/average rate. Exchange differences are taken to the statement of profit and loss. Non-integral foreign operations All assets and liabilities are to be translated at closing rate. Profit and loss account items are translated at actual/average rates). The resulting exchange difference is taken to Foreign Currency Translation Reserve and is transferred to profit and loss on the disposal of the non-integral foreign operation. Loss of control: Treatment for disposal does not depend on whether control over a foreign subsidiary is lost or not. Even if control is lost, only proportionate amount of exchange difference in the foreign currency translation reserve is recycled to statement of profit and loss.	Income and expenses should be translated at actual/average rates for the period. Exchange differences are recognised in other comprehensive income and accumulated in a separate component of equity. These are reclassified from equity to profit or loss (as a reclassification adjustment) when the gain or loss on disposal is recognised. Loss of control: Treatment of disposal depends on whether control is lost or not. Thus, if control is lost, the exchange difference attributable to the parent is reclassified to profit or loss from foreign currency translation reserve in other comprehensive income.
Derivatives	AS 11 applies to exchange differences on all forward exchange contracts including those entered into to hedge the foreign ‘currency risk of assets and liabilities. However, AS 11 is not applicable to the exchange difference arising on forward exchange contracts entered into to hedge the foreign currency risks of future transactions covered by firm commitments or which are highly probable forecast transactions.	Ind AS 21 includes within its scope the foreign currency derivatives that are not within the scope of Ind AS 109 (e.g. some foreign currency derivatives that are embedded in other contracts) Further, Ind AS 21 is applicable when amounts relating to derivatives are translated from its functional currency to its presentation currency
Forward exchange contracts	Contracts not intended for trading or speculation purposes: Any premium or discount arising at the inception of a forward exchange contract is amortized as expense or income over the life of the contract. Exchange differences on such a contract are recognized in the statement of profit and loss in the reporting period in which the exchange rates change. Exchange difference on such forward exchange contracts is the difference between: the foreign currency amount of contract translated at the exchange rate at the reporting date or the settlement date where the transaction is settled during the reporting period, and
	the same foreign currency amount translated at the later of the date of inception of the forward exchange contract and the last reporting date. Contracts intended for trading or speculation purposes: The premium or the discount on the contract is ignored at each balance sheet date. The value of the contract is marked to its current market value and the gain or loss on the contract is recognized	Forward exchange contracts and other similar financial instruments which are covered under Ind AS 109, are excluded

II. ASSETS AND LIABILITIES

Property Plant and Equipment: Significant Difference between AS 10 and Ind AS 16

TOPIC	AS 10 Property, Plant and Equipment	IND AS 16 Property, Plant and Equipment
Review of residual value	Estimates with respect to residual value are not required to be reviewed and updated.	The residual value should be reviewed at least at each financial year-end and, the change(s) shall be accounted for as a change in an accounting estimate in accordance with Ind AS 8.
Reassessment of useful life	Needs to be reviewed periodically. However, the timelines are not specified	Reviewed at least at each financial year- end or more frequently if circumstances warrant.
Frequency of revaluation	No equivalent guidance	Revaluations are required to be made with sufficient regularity to ensure that the carrying value does not differ materially from the fair value at the end of the previous reporting period.
Government grant received for PPE	AS 12 provides an option of reducing the grant received from the gross value of the asset concerned.	Ind AS 20 does not allow the same.
Cost of major Inspections	Costs of major inspections are generally expensed when incurred.	Cost of major inspections is recognized in the carrying amount of PPE, if recognition criteria are satisfied and any remaining carrying amount of the cost of previous inspection is derecognized.

Intangible Assets: Significant Differences between AS 26 and Ind AS 38

TOPIC	AS 26	IND AS 38
Separately acquired Intangible assets	No such provision	In the case of separately acquired intangibles, the criterion of probable inflow of expected future economic benefits is always considered satisfied, even if there is uncertainty about the timing or the amount of the inflow.
Revenue based amortization method	Does not specifically deal with revenue based amortization method	There is a rebuttable presumption that an amortization method that is based on the revenue generated by an activity that includes the use of an intangible asset is inappropriate. Ind AS 38 allows use of revenue based method of amortization of intangible asset, in a limited way
Payment deferred beyond normal credit terms	No such provision	If payment for an intangible asset is deferred beyond normal credit terms, the difference between this amount and the total payments is recognized as interest expense over the period of credit unless it is capitalized as per Ind AS 23
Acquired in Business combination	Refers only to intangible assets acquired in an amalgamation in the nature of purchase and does not refer to business combinations as a whole	Ind AS 38 deals in detail in respect of intangible assets acquired in a business combination.
Intangible assets acquired in exchange	When an asset is acquired in exchange for another asset, its cost is usually determined by reference to the fair market value of the consideration given. It may be appropriate to consider also the fair market value of the asset acquired if this is more clearly evident. An alternative accounting treatment to record the asset acquired at the net book value of the asset given up; in each case an adjustment is made for any balancing receipt or payment of cash or other consideration also.	Requires that if an intangible asset is acquired in exchange of a non- monetary asset, it should be recognized at the fair value of the asset given up unless (a) the exchange transaction lacks commercial substance or (b) the fair value of neither the asset received nor the asset given up is reliably measurable.
Intangible Assets acquired Free of Charge or for a Nominal Consideration by way of Government Grant	Intangible assets acquired free of charge or for nominal consideration by way of government grant is recognized at nominal value or at acquisition cost, as appropriate plus any expenditure that is attributable to making the asset ready for intended use.	When intangible assets are acquired free of charge or for nominal consideration by way of government grant, an entity should, in accordance with Ind AS 20, record both the grant and the intangible asset at fair value.
Useful life of an intangible asset	Assumption that the useful life of an intangible asset is always finite, and includes a rebuttable presumption that the useful life cannot exceed ten years from the date the asset is available for use.	Recognizes that the useful life of an intangible asset could even be indefinite subject to fulfillment of certain conditions, in which case it should not be amortized but should be tested for impairment.
Valuation model	Revaluation model is not permitted model as its accounting policy	Permits an entity to choose either the cost model or the revaluation
Change in method of amortization	Change in the method of amortization is a change in accounting policy	This would be a change in accounting estimate.

IND AS 40 : Investment Property (No corresponding standard under IGAAP, except that AS-13 provides for the cost model to be adopted on similar lines as for Property, Plant and Equipment)

Definition of Investment Property

Investment property is property (land or building or part of a building or both) held by the owner or by the lessee as a right to use the asset) to earn rentals or for capital appreciation or both rather than for:

• Use in the production or supply of goods or service or for administrative purpose or
• Sale in the ordinary course of business

Recognition

• Probable that future economic benefits that are associated with the investment property will flow to entity.
• The cost of investment property can be measured reliably.

Measurement at Recognition

An owned investment property shall be measured initially at cost. Transaction costs are included in the initial investment.

Deferred payments:- If payment for an investment property is deferred, its cost is the cash price equivalent.

Investment property acquired through exchange of another asset:- The cost of Investment property is measured at fair value of Investment property unless:

• The exchange transaction lacks commercial substance
• The fair value of neither the asset received nor the asset given up is reliably measurable.

Derecognition

An investment property shall be derecognised on disposal or when the investment property is withdrawn permanently from use and no further economic benefits are expected from its disposal.

Disclosures

• The accounting policy for measurement of investment property.
• The criteria it uses to distinguish investment property from owner occupied property and from property held for sale in the ordinary course of business.
• The revenue and expenses incurred on the investment property
• Contractual obligations associated with the investment property.
• Reconciliation of investment property at carrying amounts at the beginning and end of reporting period.

Ind AS 116 : Leases (applicable w.e.f. April 1, 2019) (Significantly different from AS 19)

Scope

An entity shall apply this Standard to all leases, including leases of right-of-use assets in a sublease

Recognition exemptions

A lessee may elect not to apply the Standard to the following leases:

1. Short-term leases (a lease at the commencement date has a lease term of 12 months or less and does not contain a purchase option); and
2. Leases for which the underlying asset is of low value.

If a lessee elects not to apply the recognition requirements to the above, it shall recognise the lease payments associated with those leases as an expense on either a straight-line basis over the lease term or another systematic basis.

Identifying a lease

At inception of a contract, an entity shall assess whether the contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Lease term

An entity shall determine the lease term as the non-cancellable period of a lease, together with both:

1. Periods covered by an option to extend the lease if the lessee is reasonably certain to exercise that option; and
2. Periods covered by an option to terminate the lease if the lessee is reasonably certain not to exercise that option.

I. LESSEE

Recognition

At the commencement date, a lessee shall recognise a right-of-use asset and a lease liability.

Measurement

Initial measurement of the right-of-use asset:

At the commencement date, a lessee shall measure the right-of-use asset at cost.

The cost of the right-of-use asset shall comprise:

1. The amount of the initial measurement of the lease liability (as stated below)
2. any lease payments made at or before the commencement date, less any lease incentives received;
3. any initial direct costs incurred by the lessee; and
4. an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease, unless those costs are incurred to produce inventories.

Initial measurement of the lease liability:

At the commencement date, a lessee shall measure the lease liability at the present value of the lease payments that are not paid at that date.

(The lease payments shall be discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the lessee shall use the lessee’s incremental borrowing rate.)

Presentation

A lessee shall either present in the balance sheet, or disclose in the notes:

1. Right-of-use assets separately from other assets.
2. Lease liabilities separately from other liabilities.

In the statement of cash flows, a lessee shall classify:

1. Cash payments for the principal portion of the lease liability within financing activities;
2. Cash payments for the interest portion of the lease liability within financing activities applying the requirements in Ind AS 7, Statement of Cash Flows, for interest paid; and
3. Short-term lease payments, payments for leases of low-value assets and variable lease payments not included in the measurement of the lease liability within operating activities.

Disclosures

A lessee shall disclose (In Tabular Format) the following amounts for the reporting period:

1. Depreciation charge for right-of-use assets by class of underlying asset;
2. Interest expense on lease liabilities;
3. The expense relating to short-term leases;
4. The expense relating to leases of low-value assets.;
5. The expense relating to variable lease payments not included in the measurement of lease liabilities;
6. Income from subleasing right-of-use assets;
7. Total cash outflow for leases;
8. Additions to right-of-use assets;
9. Gains or losses arising from sale and leaseback transactions; and
10. The carrying amount of right-of-use assets at the end of the reporting period by class of underlying asset.

II. LESSOR

A lessor shall classify each of its leases as either an operating lease or a finance lease.

Finance Lease

A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset and if not then it is operating lease.

Recognition and Measurement

At the commencement date, a lessor shall recognise assets held under a finance lease in its balance sheet and present them as a receivable at an amount equal to the net investment in the lease.

Operating Leases

Recognition and Measurement

A lessor shall recognise lease payments from operating leases as income on either a straight-line basis or another systematic basis.

Presentation

A lessor shall present underlying assets subject to operating leases in its balance sheet according to the nature of the underlying asset.

Disclosures

A lessor shall disclose (Tabular Format) the following amounts for the reporting period:

1. For finance leases:
   1. Selling profit or loss;
   2. Finance income on the net investment in the lease; and
   3. Income relating to variable lease payments not included in the measurement of the net investment in the lease.
2. For operating leases:
   4. Lease income, separately disclosing income relating to variable lease payments that do not depend on an index or a rate.

Inventories: Significant differences between AS 2 and Ind AS 2

Topic	AS 2, Inventories	Ind AS 2, Inventories
Inventory of Service Provider	No specific guidance	Requires that inventory of service provider may be described as “work- in-progress”.
Inventory held by Commodity Broker- trader	No specific guidance	Does not apply to measurement of inventories held by commodity broker-traders, who measure their inventories at fair value less costs to sell.
Reversal of write-down of inventory	No specific guidance	Write-down of inventory is reversed if the circumstance of write-down no longer exists or when there is clear evidence of increase in NRV because of change in circumstances. The amount of reversal in such cases is limited to amount of original write-down.
Inventories acquired on Deferred Settlement basis	No specific guidance	When an entity purchases inventories on deferred settlement terms, it effectively contains a financing element, being the difference between the purchase price for normal credit terms and the amount paid which is recognised as interest expense over the period of the financing.
Disclosures	Provides lesser disclosures like accounting policies, total carrying amount and classification of inventory.	Additional disclosures: The carrying amount of inventory at NRV. Amount of inventory recognized as expense during the period. The amount of inventory write-down and reversal thereof. Carrying amount of inventory pledged.

Impairment of Assets: Significant Differences between AS 28 and Ind AS 36

Topic	AS 28 : Impairment of Assets	IND AS 36 : Impairment of Assets
Biological assets	Does not exclude biological assets	Ind AS 36 specifically excludes biological assets related to agricultural activity
Impairment Testing	AS 28 does not require the annual impairment testing for the goodwill unless there is an indication of impairment	Ind AS 36 requires annual impairment testing for an intangible asset with an indefinite useful life or not yet available for use and goodwill acquired in a business combination
Reversal of impairment loss for Goodwill	Impairment loss recognised for goodwill should be reversed in a subsequent period when it was caused by a specific external event of an exceptional nature that is not expected to recur and subsequent external events that have occurred that reverse the effect of that event.	Ind AS 36 prohibits the recognition of reversals of impairment loss for goodwill.

Provisions, Contingent Liabilities and Contingent Assets: Significant difference between AS 29 and Ind AS 37

Topic	AS 29 : Provisions, Contingent Liabilities and Contingent Assets	Ind AS 37 : Provisions, Contingent Liabilities and Contingent Assets
Discounting	AS 29 prohibits discounting of provisions except in case of decommissioning, restoration and other similar liabilities, that are considered as a part of cost of PPE.	Ind AS 37 requires discounting the amounts of provision, if the effect of time value of money is material.
Recognition of Provisions	AS 29 requires creation of provision as a result of: Normal Business Practices Customs Desire to maintain good business relationships To act in equitable manner.	Ind AS 37 also requires creation of provision in respect of constructive obligation. Consequently, the terms “legal obligation” and “constructive obligation” have been inserted and defined in Ind AS 37.
Decommissioning, Restoration and similar Liabilities	No specific guidance	Ind AS 37 provides guidance on: Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds Liabilities arising from participating in Specific Market – Waste Electrical and Electronic Equipment and Levies (Imposed by Government)
Future Operating Losses	AS 29 states that no provision is to be made for identifiable future operating losses up to the date of restructuring.	Ind AS 37 states that no provision is to be made for identifiable future operating losses up to the date of restructuring, except losses related to onerous contract.
Contingent Assets	Contingent Assets are neither recognized nor disclosed in the financial statements. They are usually disclosed as a part of the report of approving authority.	Contingent Assets are not recognized but disclosed in financial statements when an inflow of economic benefits is probable.
Restructuring costs	Requires recognition based on general recognition criteria for provisions i.e. when the entity has a present obligation as a result of past event and liability is considered probable and can be reliably estimated.	Provision is also required to be made on basis of constructive obligations. A constructive obligation to restructure arises only when an entity has a detailed formal plan for the restructuring and has raised a valid expectation for the same.

Financial Instruments

Ind AS 109, 107 and 32 : Financial Instruments

(No corresponding Standards under IGAAP, except AS-13 which provides for classification of Investments into Long Term and Current with the valuation of the former being at cost less provision for diminution other than temporary and at cost or market / fair value, whichever is less for the latter)

Ind AS 109 : Financial Instruments

Scope

Ind-AS 109 is applicable to all entities and to all types of Financial Instruments, except as under:

• Entity’s interest in subsidiaries/associates/JV, if the entity has opted for disclosure of those interests at cost
• Rights and obligations under leases to which Ind AS 116 applies
• Employers’ rights and obligations under employee benefit plans, to which Ind AS 19 applies
• Financial Instruments issued by the entity which meet the definition of an equity instruments as per Ind AS 32 (holder of those instruments will continue to apply Ind AS 109)
• Rights and obligations arising under insurance contracts
• Financial Instruments, contracts & obligations under share based payments to which Ind AS-102 applies.
• Rights and obligations within the scope of Ind AS 115, except for those that Ind AS 115 specifies that they should be accounted for in accordance with Ind AS 109

Initial Recognition

Financial Assets and liabilities to be recognised, when and only when, it becomes party to the contractual provisions of the instruments.

Derecognition of Financial Assets (Defined under Ind-AS 32 below)

• Contractual rights to the cash flows from the financial asset expire; or
• Entity transfers the financial asset and the transfer qualifies for derecognition

Derecognition of Financial Liabilities (Defined under Ind-AS 32 below)

• An entity shall derecognise financial liability when it is extinguished (obligation discharged or cancelled or expired).
• In case of changes or substantial modifications in terms between the borrower and lender for existing financial liabilities, the old liability should be derecognised and new liability shall be recognised. Any difference between the amount of old and new liability is recognised in profit and loss.

Initial Measurement

At initial recognition, Financial Assets or Financial Liabilities shall be accounted at Fair Value.

For subsequent measurement, Financial Assets and Liabilities shall be classified as follows:

Classification of Financial Assets

For subsequent measurement, Financial Assets are classified as measured at:

• Amortised Cost; or
• Fair Value through OCI (FVTOCI); or
• Fair Value through P&L (FVTPL).

The above classification is based on Business Model test and SPPI test for characteristics of the asset.

Amortised Cost

Financial Assets to be measured at amortised cost if both the following conditions are satisfied:

• Business model for the asset is to hold financial assets in order to collect contractual cash flows
• Cash flow from Financial Assets give rise solely to receipt of principal and interest (SPPI)

FVTOCI

Financial Assets to be measured at FVTOCI if both the following conditions are satisfied:

• Business model for the asset is to hold financial assets in order to collect contractual cash flows/selling financial assets.
• Cash flow from Financial Assets give rise to receipt of principal interest

FVTPL

• Residual Financial Assets

Notes

• For particular investment in equity instruments, an entity has irrevocable election at initial recognition to recognise the same at FVTPL or FVTOCI.
• In order to remove accounting mismatch, the entity may, at initial recognition, irrevocably designate a financial asset as measured at FVTPL.

Business Model Test

The entity’s business model refers to how an entity manages its financial assets in order to generate cash flows. Cash flow can be generated through collecting contractual cash flows, selling financial assets or both. This test should not be performed on the basis of “worst case scenarios”.

SPPI Test

SPPI Test refers to Financial Assets held solely for receipt of principal and interest on the principal outstanding.

Classification of Financial Liabilities

At subsequent measurement, Financial Liabilities are measured at amortised cost except mainly for Financial Liabilities measured at FVTPL (such liabilities mainly comprise of Derivative instruments classified as liability) and contingent consideration liabilities which are also recorded at FVTPL.

In order to remove accounting mismatch, the entity has an option to designate Financial Liability at FVTPL.

Amortised Cost Measurement

EIR Method

Interest revenue shall be calculated by using Effective Interest Rate (EIR) method. That EIR is applied to the gross carrying value of Financial Assets to arrive at interest income.

Not applicable in case of credit impaired financial assets.

EIR is a rate that exactly discounts estimated future cash flows through life of financial assets or liabilities to the gross carrying amount of Financial Assets or liabilities.

Impairment

An entity shall recognise Expected Credit Loss (ECL) allowance on a financial assets measured in accordance with Ind AS 109. The ECL shall be measured in a way that reflects:

• an unbiased and probability weighted amount that is determined by evaluation of a range of possible outcomes.
• Time value of money should be considered
• Supported by reasonable information available at undue costs.

Derivatives

A Derivative is a financial instrument or other contract within the scope of Ind AS 109 with all three of the following characteristics:

• Its value changes in response to the change in underlying variable.
• It requires no initial net investment / investment smaller than underlying amount.
• It is settled at future date.

Measurement of Derivatives

Derivatives instruments are measured at FVTPL (other than derivative used as hedging instruments).

Hedge Accounting

Hedge instrument is a financial instrument, whose fair value or cash flow is expected to offset changes in the fair value or cash flow of a designated hedge items.

There are three types of hedging relationships:

1. Fair Value Hedge: hedge against changes in Fair Value of a recognised asset/liability or unrecognised firm commitment.

   Accounting of FV Hedge:

   • Gain/Loss on the hedge instruments shall be recognised in profit and loss (if hedged item is equity instruments measured at FVTOCI, gain/loss to be recognised in OCI).
   • The hedging gain/loss on the hedged item shall adjust the carrying value of the hedged items & shall be recognised in profit and loss (OCI in case of equity instruments measured at FVTOCI)
2. Unrecognised Firm Commitment- changes in FV of hedged item shall be recognised in profit and loss.
3. Cash Flow Hedge: A hedge of exposure to a variability in cash flows of highly probable forecast transaction.

Accounting of CF Hedge:

• A separate component of equity associated with the hedged item (Cash Flow Hedge Reserve) is created.
• Cumulative gain or loss on the hedging instrument from inception of the hedge or cumulative change in FV of hedged item from inception of the hedge, whichever is lower is transferred to Cash Flow Hedge Reserve
• Gain or loss on the hedging instrument to the extent of effective hedge (high degree of co-relation between the hedge instrument and the hedge items reflected through an hedge ratio of one) is recognised in OCI.
• Remaining gain/loss on hedging instrument is recognised in profit and loss.
• Treatment of amount accumulated in Cash Flow Hedge:

Situation	Treatment
Hedging item is Non-Financial Asset/Liability	Remove amount from Cash Flow Hedge Reserve and adjust the same to carrying value of Non-Financial Asset/Liability. No impact on OCI
Other than above	Reclassification adjustment. Amount should be reclassified to Cash flow Hedge Reserve to Profit or Loss.
In case of loss and it is expected that at least part loss will not be recovered	Reclassify amount expected not to be recovered in P&L

4. Hedge of a net investment in a foreign operations as defined in Ind AS 21.

   Accounting of Net Investment Hedge:

   • Gain/Loss on Effective hedge portion to be recognised in OCI.
   • Remaining shall be recognised in P&L

Ind AS 32: Financial Instruments Presentation

Scope

Ind-AS 32 is applicable to all entities and to all types of Financial Instruments, except for the following:

• Entity’s interest in subsidiaries/associates/JV, if the entity has opted for disclose those interests at cost.
• Employers’ rights and obligations under employee benefit plans, to which Ind AS 19 applies
• Rights and obligations & financial instruments under insurance contracts
• Financial Instruments, contracts & obligations under share based payments to which Ind AS-102 applies.

Definitions

Financial Instrument is any contract that gives rise to a financial asset of one entity or financial liability or equity instrument of another entity.

Financial Liability is any liability that is:

1. a contractual obligation :
   1. to deliver cash or another financial asset to another entity; or
   2. to exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavourable to the entity; or
2. a contract that will or may be settled in the entity’s own equity instruments and is:
   1. a non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments;
      or
   2. a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments.

Financial Asset is any liability that is:

• Cash
• Equity instrument of another entity
• Contractual right to receive cash or another financial asset from another entity
• Contractual right to exchange financial asset or financial liability with another entity under condition which are favourable to the entity
• Contract that will be or may be settled in the entity’s own equity instruments and is:
  • a non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments;
  • or
  • a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments.

Equity Instrument is any contract that evidences a residual interest in the asset of an entity after deducting all its liabilities.

Puttable instrument is a financial instrument that gives the holder the right to put the instrument back to the issuer for cash or another financial asset or is automatically put back to the issuer on the occurrence of an uncertain future event or the death or retirement of the instrument holder.

Compound Financial Instrument

It is a non-derivative financial instrument which contains characteristics of financial liability and equity. Such components shall be classified separately as Financial Liabilities, asset or equity.

Treasury Shares

If an entity reacquires its own equity instruments, those instruments shall be deducted from equity. No gain/loss to be recognised on purchase, sale, issue or cancellation of entity’s own equity instruments.

Offsetting Financial Asset and Liabilities

Offsetting to be done when and only when the entity has current, legally enforceable right to set off the recognised amounts and it intends to do so.

Right of set-off must be not contingent on future events and must be legally enforceable in all of the following conditions:

• the normal course of business
• the event of default
• the event of insolvency or bankruptcy of the entity and all the counterparties.

Ind AS 107: Financial Instruments- Disclosures

Balance Sheet Disclosures

Categories of Financial Assets and Liabilities

• Financial assets measured at fair value through profit or loss, showing separately: (i) those designated as such upon initial recognition or subsequently in accordance with Ind AS 109 and (ii) those mandatorily measured at fair value through profit or loss in accordance with Ind AS 109.
• Financial liabilities at fair value through profit or loss, showing separately: (i) those designated as such upon initial recognition or subsequently in accordance with Ind AS 109 and (ii) those that meet the definition of held for trading in Ind AS 109.
• Financial Assets and Liabilities at amortised cost.
• Financial assets measured at fair value through OCI, showing separately (i) financial assets that are so measured in accordance with Ind AS 109; and (ii) investments in equity instruments designated as such upon initial recognition in accordance with Ind AS 109.

Financial Assets or Liabilities at FVTPL

In respect of Financial Assets or groups thereon not mandatorily required to be classified at FVTPL, the following specific disclosures are required to be given:

• the maximum exposure to credit risk at the end of the reporting period.
• the amount by which any related credit derivatives or similar instruments mitigate that maximum exposure to credit risk
• the amount of change, during the period and cumulatively, in the fair value of the financial asset (or group thereon) that is attributable to changes in the credit risk of the financial asset determined either:
  1. as the amount of change in its fair value that is not attributable to changes in market conditions that give rise to market risk ; or
  2. using an alternative method the entity believes more faithfully represents the amount of change in its fair value that is attributable to changes in the credit risk of the asset.
     • Changes in market conditions that give rise to market risk include changes in an observed (benchmark) interest rate, commodity price, foreign exchange rate or index of prices or rates.
     • the amount of the change in the fair value of any related credit derivatives or similar instruments that has occurred during the period and cumulatively since the financial asset was designated.

In respect of Financial Liabilities at FVTPL, the following specific disclosures are required to be given:

• the amount of change, cumulatively, in the fair value of the financial liability that is attributable to changes in the credit risk of that liability.
• the difference between the financial liability’s carrying amount and the amount the entity would be contractually required to pay at maturity to the holder of the obligation.
• any transfers of the cumulative gain or loss within equity during the period including the reason for such transfers.
• if a liability is derecognised during the period, the amount (if any) presented in OCI.

Equity Investments designated at FVTOCI

• The specific investments in equity instruments have been designated to be measured at FVTOCI and the reasons for using this presentation alternative.
• The fair value of each such investment at the end of the reporting period.
• Dividends recognised during the period, showing separately those related to investments derecognised during the reporting period and those related to investments held at the end of the reporting period.
• Any transfers of the cumulative gain or loss within equity during the period including the reason for such transfers
• In case of de recognition / disposal:
  1. Reasons for disposal
  2. Fair value on date of disposal
  3. Cumulative gain or loss on disposal
  4. Reclassification of Financial Assets

Reclassification of Financial Assets and Liabilities

• the date of reclassification.
• a detailed explanation of the change in business model and a qualitative description of its effect on the entity’s financial statements.
• the amount reclassified into and out of each category.
• For each reporting period following reclassification until derecognition, an entity shall disclose for assets reclassified out of the FVTPL so that they are measured at amortised cost or FVTOCI:
  1. The effective interest rate determined on the date of reclassification; and
  2. The interest revenue recognised.
• If, since its last annual reporting date, an entity has reclassified financial assets out of FVTOCI so that they are measured at amortised cost or out of FVTPL, it shall disclose:
  1. the fair value of the financial assets at the end of the reporting period; and
  2. the fair value gain or lossthat would have been recognised in profit or loss or other comprehensive income during the reporting period if the financial assets had not been reclassified.

Off Setting of Financial Assets and Liabilities

An entity shall disclose, at the end of the reporting period, the following quantitative information separately for recognised financial assets and recognised financial liabilities which are subject to off-setting:

1. the gross amounts of those recognised financial assets and recognised financial liabilities;
2. the amounts that are set-off in accordance with the criteria in Ind AS 32 when determining the net amounts presented in the statement of financial position;
3. the net amounts presented in the balance sheet;
4. the amounts subject to an enforceable master netting arrangement or similar agreement that are not otherwise included in paragraph (b) above, including: (i) amounts related to recognised financial instruments that do not meet some or all of the offsetting criteria in Ind AS 32; and (ii) amounts related to financial collateral (including cash collateral); and
5. the net amount after deducting the amounts in (d) from the amounts in (c) above

Collateral

• the carrying amount of financial assets it has pledged as collateral for liabilities or contingent liabilities, including amounts that have been reclassified; and
• the terms and conditions relating to its pledge.
• When an entity holds collateral (of financial or non-financial assets) and is permitted to sell or repledge the collateral in the absence of default by the owner of the collateral, it shall disclose:
  1. the fair value of the collateral held;
  2. the fair value of any such collateral sold or repledged, and whether the entity has an obligation to return it; and
  3. the terms and conditions associated with its use of the collateral.

Allowance for Credit Losses

• The carrying amount of financial assets measured at FVTOCI is not reduced by a loss allowance and an entity shall not present the loss allowance separately in the balance sheet as a reduction of the carrying amount of the financial asset.
• However, an entity shall disclose the loss allowance in the notes to the financial statements.

Compound Financial Instruments with Multiple Embedded Derivatives

If an entity has issued an instrument that contains both a liability and an equity component and has multiple embedded derivatives whose values are interdependent (such as a callable convertible debt instrument), it shall disclose the existence of those features.

Defaults and Breaches

• For loans payable recognised at the end of the reporting period, an entity shall disclose:
  1. details of any defaults during the period of principal, interest, sinking fund, or redemption terms of those loans payable;
  2. the carrying amount of the loans payable in default at the end of the reporting period; and
  3. whether the default was remedied, or the terms of the loans payable were renegotiated, before the financial statements were approved for issue.
• If, during the period, there were breaches of loan agreement terms other than those described above (i.e. various covenants), an entity shall disclose the same information as required above, if those breaches permitted the lender to demand accelerated repayment (unless the breaches were remedied, or the terms of the loan were renegotiated, on or before the end of the reporting period).

Profit and Loss Statement Disclosures

• Net gains or losses on financial assets or financial liabilities measured at FVTPL showing separately those on financial assets or financial liabilities designated as such upon initial recognition or subsequently, and those on financial assets or financial liabilities that are mandatorily measured at FVTPL
• For financial liabilities designated as at fair value through profit or loss, an entity shall show separately the amount of gain or loss recognised in other comprehensive income and the amount recognised in profit or loss.
• Net gains or losses on financial liabilities and financial assets measured at amortised cost.
• Net gains or losses on investments in equity instruments designated at FVTOCI.
• Net gains or losses on financial assets measured at FVTOCI showing separately the amount of gain or loss recognised in OCI during the period and the amount reclassified upon derecognition from accumulated OCI to profit or loss for the period.
• Total interest revenue and total interest expense (calculated using the effective interest method) for financial assets that are measured at amortised cost or that are measured at FVTOCI (showing these amounts separately); or financial liabilities that are not measured at fair value through profit or loss
• Fee income and expense (other than amounts included in determining the effective interest rate) arising from:
  1. financial assets and financial liabilities that are not FVTPL; and
  2. trust ansd other fiduciary activities that result in the holding or investing of assets on behalf of individuals, trusts, retirement benefit plans, and other institutions.

Other Disclosures

Hedge Accounting

These disclosures can broadly be categorised as under:

• The entity’s risk management strategy and how it is applied to manage the risk for each category of risk exposure together with the hedging instruments that are used, including the manner of use thereof, the economic relationship between the hedged item and the hedging instrument for assessing hedge effectiveness and the manner of establishment of the hedge ratio and the sources of hedge ineffectiveness.
• An entity shall disclose by risk category quantitative information to allow users of its financial statements to evaluate the terms and conditions of hedging instruments and how they affect the amount, timing and uncertainty of future cash flows of the entity. For this purpose, the entity shall provide a breakdown that discloses:
  1. a profile of the timing of the nominal amount of the hedging instrument; and
  2. if applicable, the average price or rate (for example strike or forward prices etc.) of the hedging instrument.
• An entity shall disclose, in a tabular format, the following amounts related to items designated as hedging instruments separately by risk category for each type of hedge (fair value hedge, cash flow hedge or hedge of a net investment in a foreign operation):
  1. the carrying amount of the hedging instruments (financial assets separately from financial liabilities);
  2. the line item in the balance sheet that includes the hedging instrument;
  3. the change in fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness for the period; and
  4. the nominal amounts (including quantities such as tonnes or cubic metres) of the hedging instruments.
• An entity shall disclose, in a tabular format, the following amounts related to hedged items separately by risk category for the types of hedges as follows:
  1. for fair value hedges: (i) the carrying amount of the hedged item recognised in the balance sheet (presenting assets separately from liabilities); (ii) the accumulated amount of fair value hedge adjustments on the hedged item included in the carrying amount of the hedged item recognised in the balance sheet (presenting assets separately from liabilities); (iii) the line item in the balance sheet that includes the hedged item; (iv) the change in value of the hedged item used as the basis for recognising hedge ineffectiveness for the period; and (v) the accumulated amount of fair value hedge adjustments remaining in the balance sheet for any hedged items that have ceased to be adjusted for hedging gains and losses .
  2. for cash flow hedges and hedges of a net investment in a foreign operation: (i) the change in value of the hedged item used as the basis for recognising hedge in effectiveness for the period (i.e. for cash flow hedges the change in value used to determine the recognised hedge ineffectiveness; (ii) the balances in the cash flow hedge reserve and the foreign currency translation reserve for continuing hedges; and (iii) the balances remaining in the cash flow hedge reserve and the foreign currency translation reserve from any hedging relationships for which hedge accounting is no longer applied.
• An entity shall disclose, in a tabular format, the following amounts separately by risk category for the types of hedges as follows:
  1. for fair value hedges: (i) hedge ineffectiveness—i.e. the difference between the hedging gains or losses of the hedging instrument and the hedged item—recognised in profit or loss (or other comprehensive income for hedges of an equity instrument for which an entity has elected to present changes in fair value in other comprehensive income; and (ii) the line item in the statement of profit and loss that includes the recognised hedge ineffectiveness.
  2. for cash flow hedges and hedges of a net investment in a foreign operation:(i) hedging gains or lossesof the reporting period that were recognised in other comprehensive income; (ii) hedge ineffectiveness recognised in profit or loss; (iii) the line item in the statement of profit and loss that includes the recognised hedge ineffectiveness; (iv) the amount reclassified from the cash flow hedge reserve or the foreign currency translation reserve into profit or loss as a reclassification adjustment; (v) the line item in the statement of profit and loss that includes the reclassification adjustment ; and (vi) for hedges of net positions, the hedging gains or losses recognised in a separate line item in the statement of profit and loss

Fair Value Disclosures (In addition to those covered in Ind AS-113)

These disclosures can broadly be categorised as under:

• For each class of financial assets and financial liabilities an entity shall disclose the fair value of that class of assets and liabilities in a way that permits it to be compared with its carrying amount.
• In disclosing fair values, an entity shall group financial assets and financial liabilities into classes, but shall offset them only to the extent that their carrying amounts are offset in the balance sheet.
• Description of how the fair value was determined.
• Details / reasons if the fair value cannot be determined.

Risk Disclosures

Qualitative Disclosures (for each type of risk)

• the exposures to risk and how they arise;
• objectives, policies and processes for managing the risk and the methods used to measure the risk; and
• any changes in the above from the previous period.

Common Quantitative Disclosures (for each type of risk)

• Summary quantitative data about its exposure to that risk at the end of the reporting period. This disclosure shall be based on the information provided internally to key management personnel of the entity (as defined in Ind AS 24, Related Party Disclosures).
• the disclosures on Credit Risk, Liquidity Risk and Market Risk (discussed later).
• Concentrations of risk if not apparent from the disclosures made above.

Credit Risk

• Maximum amount of exposure before deducting value of collateral.
• Description of the collateral.
• Information about the credit quality of financial assets that are neither past due or impaired.
• Information about the credit quality of financial assets whose terms have been renegotiated.
• Analytical disclosures about financial assets which are past due or impaired.

Liquidity Risk

• Maturity analysis for non-derivative financial liabilities (including issued financial guarantee contracts) that shows the remaining contractual maturities.
• Maturity analysis for derivative financial liabilities. The maturity analysis shall include the remaining contractual maturities for those derivative financial liabilities for which contractual maturities are essential for an understanding of the timing of the cash flows.
• Description of how the entity manages the liquidity risk as determined above.

Market Risk

• A sensitivity analysis for each type of market risk to which the entity is exposed at the end of the reporting period, showing how profit or loss and equity would have been affected by changes in the relevant risk variable that were reasonably possible at that date;
• The methods and assumptions used in preparing the sensitivity analysis; and
• Changes from the previous period in the methods and assumptions used, and the reasons for such changes.

Transfers of Financial Assets

The disclosures which need to be given depend upon whether the assets are derecognised or not in entirety.

In case of assets which are not derecognised in entirety, the following disclosures are required to be given:

• Nature of the transferred assets.
• Nature of the risks and rewards of ownership to which the entity is exposed.
• Description of the nature of the relationship between the transferred assets and the associated liabilities, including restrictions arising from the transfer on the reporting entity’s use of the transferred assets.
• When the counterparty (counterparties) to the associated liabilities has (have) recourse only to the transferred assets, a schedule that sets out the fair value of the transferred assets, the fair value of the associated liabilities and the net position (the difference between the fair value of the transferred assets and the associated liabilities).
• When the entity continues to recognise all of the transferred assets, the carrying amounts of the transferred assets and the associated liabilities.
• When the entity continues to recognise the assets to the extent of its continuing involvement, the total carrying amount of the original assets before the transfer, the carrying amount of the assets that the entity continues to recognise, and the carrying amount of the associated liabilities.

In case of assets which are derecognised in entirety, the following disclosures are required to be given:

• Carrying amount of the assets and liabilities that are recognised in the entity’s balance sheet and represent the entity’s continuing involvement in the derecognised financial assets, and the line items in which the carrying amount of those assets and liabilities are recognised.
• Fair value of the assets and liabilities that represent the entity’s continuing involvement in the derecognised financial assets.
• Amount that best represents the entity’s maximum exposure to loss from its continuing involvement in the derecognised financial assets, and information showing how the maximum exposure to loss is determined.
• Undiscounted cash outflows that would or may be required to repurchase derecognised financial assets or other amounts payable to the transferee in respect of the transferred assets. If the cash outflow is variable then the amount disclosed should be based on the conditions that exist at each reporting date.
• Maturity analysis of the undiscounted cash outflows that would or may be required to repurchase the derecognised financial assets or other amounts payable to the transferee in respect of the transferred assets, showing the remaining contractual maturities of the entity’s continuing involvement.
• Qualitative information that explains and supports the above quantitative disclosures
• Gain or loss recognised at the date of transfer of the assets.
• Income and Expenses recognised, both in the reporting period and cumulatively, from the entity’s continuing involvement in the derecognised financial assets (e.g. fair value changes in derivative instruments).

III. Group Accounts

Ind AS 103: Business Combination (Significantly different from AS-14 which provides for adoption of the Purchase Method or Pooling of Interest Method and the use of fair value is optional in case of the former)

Scope

It applies to transactions or other events that meets the definition of a business. It does not apply:

• Accounting for formation of Joint Arrangement in the Financial Statements or the Joint Arrangement itself.
• The acquisition of an asset or a group of asset that does not constitute a business.

Definition of Business

Business consists of inputs and processes applied for those inputs that have the ability to create output.

Recognition Principles

Business Combinations need to be recognised based on the acquisition method which requires the following steps:

• Identifying the acquirer
• Determining the acquisition date
• Recognising and measuring the identifiable assets acquired, liabilities assumed (including any contingent liabilities) and non-controlling interest in acquiree
• Recognising and measuring goodwill.

The acquirer should measure the identifiable assets acquired and liabilities assumed at their acquisition date fair values.

After initial recognition and until the liabilities is settled, cancelled or expires, the acquirer shall measure a contingent liabilities recognised in business combination at the higher of:

• Amount that should be recognised as per Ind AS 37; and
• Amount initially recognised less the cumulative amount of income recognised in accordance with Ind AS 115.

Acquisition Date

It is the date on which the acquirer obtains control of the acquired entity.

Business Combination acquired in stages

If the business combination is achieved in stages, the acquirer has obtain control over the acquire by increasing the existing equity, in such a case, the previously held equity interest is remeasured at the acquisition date fair value and resulting gain or losses are recognised as profit or loss.

Accounting for Acquisition related Costs

Acquisition costs are accounted for as expenses in the period in which those costs are incurred and services are rendered.

Measuring Non- Controlling Interest (NCI)

NCI can be measured either:

• At fair value on acquisition date
• On the basis of proportionate share of acquired company’s identifiable net assets.

Goodwill/Capital Reserve or Bargain Purchase Gain

The goodwill is measured as difference between “A” and “B”, where “A” and “B” are:

1. The aggregate of:
   • The acquisition date fair value of the consideration transferred (including fair value of any contingent consideration)
   • The amount of any NCI in the acquiree; and
   • In Business Combination achieved in stages, acquisition date fair value of the acquirer’s previously held equity interest in the entity.
2. Net of the acquisition date fair value of identifiable assets acquired and liabilities assumed.

In case, A-B is negative, the resulting gain is recognised in the OCI and accumulated in equity as Capital Reserve.

Subsequent Measurement of Goodwill

Goodwill is not amortised but tested for impairment on an annual basis or more frequently.

Accounting for Business Combination under Common Control (Appendix C of Ind AS 103)

• The assets and liabilities of the combining entities are reflected at their carrying amounts.
• No adjustments for fair value except to harmonise accounting policies.
• Financial Information of prior periods should be restated as if the business combination had occurred from the beginning of the preceding period.
• Consideration measurement:
  1. Securities: At nominal value
  2. Assets other than cash: At fair value
• Identity of the reserves shall be preserved in the merged financial statement

Any difference whether positive or negative shall be adjusted against the capital reserve or “Amalgamation Adjustment Deficit Account” under some cases. No goodwill to be recognized.

The extent of non-controlling interests in each of the combining entities before and after the business combination is not relevant in determining whether the combination under Common Control.

Ind AS 110: Consolidated Financial Statements (Significantly different from AS-21 on the assessment of control which is primarily driven by the legal form as against substance of the arrangement / relationship under IndAS-110 and in respect of certain other matters as highlighted below)

Assessment of Control

For an investor to control an investee, the investor must possess all of the following elements:

• Power over investee which is described as having existing rights and the current ability to direct the activities of the investee that significantly affect the investee’s returns
• Exposures or rights to variable returns from its involvement with investee
• Ability to use power over investee to affect the investor’s return.

For assessment of control over an investee, potential voting rights are considered only if rights are substantive and holder has practical ability to exercise the same.

Exclusion from Consolidation

Only an investment entity which meets all the following criteria is to be excluded from consolidation:

• Obtains funds from one or more investors for the purposes of providing those investors with investment management services
• It commits to its investors that its business purpose is to invest funds solely for returns from capital appreciation, investment income or both.
• Measures and evaluates the performance substantially on investment on fair value basis.

Uniform accounting Policies

A parent shall prepare consolidated financial statements using uniform accounting policies for like transactions and other events in similar circumstances.

Non-Controlling Interest

The parent shall present non-controlling interest in the consolidated balance sheet within equity, separately from the equity of the owners of the parents.

An entity shall attribute the profit or loss at each component of OCI to the owners and to the NCI.

The entity shall also attribute total comprehensive income to the owners and to the NCI even if this results in NCI having deficit balance.

Reporting Dates

The difference between the reporting date of subsidiary and that of the parent should not be more than 3 months.

Disposals

Changes in parent’s ownership interest in a subsidiary without a loss of control are accounted for as equity transactions.

If a parent loses control of a subsidiary, it shall:

• Derecognise the assets and liabilities of the former subsidiary from the consolidated balance sheet.
• Recognise any investment retained in the former subsidiary at its fair value when control is lost and subsequently account for it and for any amounts owed by or to the former subsidiary in accordance with relevant Ind AS. That fair value should be regarded as fair value on initial recognition of Financial Asset in accordance with Ind AS 109 or when appropriate, the cost of initial recognition of investment in Associate / JV.
• Recognise gain/loss associated with loss of control from former controlling interest.

Significant Differences between AS 23, 27 and Ind AS 28

Topic	AS 23 Accounting for Investments in Associates in Consolidated Financial Statements & AS-27 Financial Reporting of Interests in Joint Ventures	Ind AS 28 - Investments in Joint Ventures and Associates
Scope	There is no exemption for Investments made by venture capital organisations, mutual funds, unit trusts and similar entities.	Investments by venture capital organizations, mutual funds, unit trusts and similar entities including investment-linked Insurance funds are exempted from applying equity method, if an election is made to measure such investments at FVTPL in accordance with Ind AS 109.
Significant influence	Defined as ‘power to participate in the financial and/or operating policy decisions of investee but is not control over those policies	Defined as ‘power to participate in the financial and operating policy decisions of investee but is not control or joint control over those policies. IND AS defines joint control also in line with the definition of control as per Ind AS-110 above
Potential equity shares	For considering share ownership for the purpose of significant influence, potential equity shares of investee held by investor are not taken into account.	Existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether an entity has significant influence or not
Equity method	Requires application of equity method only for investment in associates	Requires application of equity method in case of investment in associates as well as Jointly controlled entities.
Exemption	One of the exemptions from applying equity method is where the associate operates under severe long-term restrictions that significantly impair its ability to transfer funds to investee.	No such exemption in IND AS 28
Difference in Reporting dates	Permits use of financial statements of associate drawn up to a date different from date of financial statements of investor when it is impracticable to draw the financial statements of the associate up to the date of financial statements of investor. There is no limit on the length of difference in reporting dates of investor and associate.	Length of difference in reporting dates of associate or joint venture should not be more than three months.
Accounting policies	Provides exemption that if it is not possible to make adjustments to accounting policies of associate, the fact shall be disclosed along with a brief description of differences between the accounting policies.	Provides that entity’s financial statements shall be prepared using uniform accounting policies for like transactions and events in similar circumstances unless, in case of an associate, it is impracticable to do so.
Share in losses	Investor’s share of losses in the associate is recognized to the extent of carrying amount of investment in the associate.	Carrying amount of investment in associate or JV determined using equity method together with any long term interests that in substance form part of entity’s net investment in the associate or JV shall be considered for recognizing entity’s share of losses in associate or JV

IV. Presentation and Disclosure

Ind AS 113: Fair Value Measurement

Meaning of Fair Value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

• In the principal market for the asset or liability, or
• In the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible by the entity.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

Hierarchy of Fair Value Measurement

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

• Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
• Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.
• Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

Disclosures

• The extent of usage of fair value in the valuation of assets and liabilities.
• The valuation techniques, inputs and assumptions used in measuring fair value.
• The impact of level 3 fair value measurements on the profit and loss account or other comprehensive income.
• Reasons for non-recurring fair value measurements.
• The fair value hierarchy adopted.
• The reasons for transfer between the hierarchical levels for recurring fair value measurements.
• The valuation techniques adopted, including any changes therein, for both recurring and non-recurring fair value measurements.
• Quantitative information about significant unobservable inputs for recurring level 3 fair value measurements.
• The amount of total gains and losses recognised in profit and loss and OCI, together with line items in which these are recognised, for recurring fair value measurements categorised within level 3 of the fair value hierarchy.
• Sensitivity analysis, both narrative and with quantitative disclosures about the significant unobservable inputs.

Ind AS 1: Presentation of Financial Statements (Significantly different from AS-1 which primarily deals with Disclosure of Accounting Policies)

Ind AS 1 sets out overall requirements for the presentation of financial statements, guidelines for their structure and minimum requirements for their content and ensure comparability.

Ind AS 1 applies while preparing General Purpose Financial Statements, both standalone as well as consolidated financial statements. This Ind AS is not applicable to interim financial statements.

General Purpose 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.

In general, the financial statements of an entity provide the following information about:

• assets
• liabilities
• equity
• income and expenses, including gain and losses
• contributions by and distributions to owners in their capacity as owners
• cash flows

Components of Financial Statements

• Balance Sheet as at end of the period
• Statement of Profit and Loss for the period
• Statement of Changes in Equity for the period
• Statement of Cash Flow for the period
• Notes comprising of Significant Accounting Policies and Other explanatory information
• Comparative information in respect of the preceding period
• Balance sheet at the beginning of the preceding period when an entity
  • Applies an accounting policy retrospectively
  • Makes a retrospective restatement of items in its financial statements
  • When it reclassifies items in its financial statements

Departure from Compliance with Ind AS

In the extremely rare circumstances in which management concludes that compliance with a requirement in an Ind AS would be so misleading that it would conflict with the objective of financial statements set out in the Framework, the entity shall, depart from that requirement of Ind AS and inter-alia disclose the following:

• Management’s conclusion that financial statements give true and fair view
• It has complied with applicable Ind AS except particulars of Ind AS requirement(s) not followed
• Title of relevant Ind AS
• Nature of departure
• Treatment required by Ind AS and treatment adopted
• Reason for departure
• Financial impact on account of departure

Going Concern

An entity shall prepare financial statements on a going concern basis unless the management intends to liquidate the entity or to cease trading, or has no realistic alternative but to do so.

Accrual Basis of accounting

An entity shall prepare its financial statements, except for cash flow information, using the accrual basis of accounting.

Materiality and aggregation

Omissions or misstatements of items are material if they could, individually or collectively, influence the economic decision that users make on the basis of the financial statements.

An entity shall present separately each material class of similar items.

An entity need not provide a specific disclosure required by an Ind AS if the information is not material except when required by law.

Offsetting

Offsetting is not permitted unless required or permitted by other Ind AS.

Consistency of Presentation

An entity shall retain the presentation and classification of items in the Financial Statements from one period to the next unless:

• It is apparent, following a significant change in the nature of entity’s operations or a review of its financial statements, that another presentation or classification would be more appropriate having regard to the criteria for Ind AS 8.
• Ind AS requires change in presentation.

Current/Non-Current Distinction

An entity shall present current and non-current assets and liabilities separately in its balance sheet.

An entity shall classify an asset as current when:

• It expects to realise the asset, or intends to sell or consume it, in its normal operating cycle
• It holds the asset primarily for the purpose of trading
• It expects to realise the asset within 12 months after the reporting period
• The asset is cash and cash equivalent unless it is restricted

An entity shall classify a liability as current when:

• It expects to settle the liability in its normal operating cycle
• It holds the liability primarily for the purpose of trading
• The liability is due to be settled within 12 months after reporting period
• It does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

Disclosure of Judgments

An entity is required to disclose in the significant accounting policies or other notes, the judgments apart from those involving estimates that the Management has made in the process of applying the entity’s accounting policies that have the most significant impact on the amounts recognised in the financial statements.

Disclosure of Estimation Uncertainty

An entity is required to disclose information about the assumptions it makes about the future and other major sources of estimation uncertainty at the end of the reporting period, that have a significant risk of resulting in a material adjustment of the carrying amounts of the assets and liabilities within the next financial year.

Capital Management Disclosures

An entity is required to disclose information that enables users of the financial statements to evaluate the entity’s objectives, policies and processes for managing capital.