IND AS Implementation

IN
Dated
ND
d: 1th
June
AS
2016
Mob
S IM
CA. AS
bile 9990999281‐
MPL
SHWANI RASTOG
‐ ashwani.rastogi
EM
GI
.ca@gmail.com
MENNTATTIOON

MCA
Comp
state
of th
with
A notifi
panies ha
ments as
eir financ
the comp
cation d
aving a ne
on 31st M
cial statem
aratives fo
Mob
dated 1
et worth o
March, 20
ments for
or the per
CA. AS
bile 9990999281‐
16.02.20
of Rs. 500
014) are re
accountin
iods endin
SHWANI RASTOG
‐ ashwani.rastogi
015
0 crores or
equired to
ng periods
ng 31st M
GI
.ca@gmail.com
r more (as
o comply w
s beginnin
arch, 201
s per the
with Ind A
ng on or a
16, or ther
standalon
AS in the p
after 1st A
reafter.
ne financi
preparatio
April, 201
ial
on
6,

Mob
CA. AS
bile 9990999281‐
SHWANI RASTOG
‐ ashwani.rastogi
GI
.ca@gmail.com

CA. ASHWANI RASTOGI
Mobile 9990999281‐ ashwani.rastogi.ca@gmail.com
Deliverables in Ind AS regime
 As part of Ind AS transition process, companies covered in first phase will have to
prepare:
 Opening Ind AS Balance sheet as at 1 April 2015.
 Equity reconciliation on 1 April 2015 & 31 Mar 2016.
 Income Reconciliation for the year ending 31 Mar 2016
 Ind AS financial statements as at and for the year ending 31 Mar 2016 for
comparatives.
 Ind AS Financial statements as at and for year ending 31 Mar 2017.
Fobes news:-
Indian corporates are gearing up to understand and implement the new accounting framework called Indian Accounting
Standards (Ind AS). The Ind AS is almost the same as the International Financial Reporting Standards as issued by the
International Accounting Standards Board (IFRS), which is followed by more than 100 countries.
Ind AS will replace the current accounting standards followed by companies in India. The ministry of corporate affairs
(MCA), government of India, notified these on February 16, 2015, and recommended its application in a phased manner
from April 1, 2016. Effectively, the quarterly results for June 30, 2016, would be the first such reporting period for listed
companies above the threshold.
Needless to say, the impact of any fundamental change to an accounting framework has a much wider ramification on the
company. Any transaction, from a routine sales transaction to corporate restructuring, needs to be told in an accounting
language. So when that changes, the impact is pervasive.
Analysts and the Street who are rating companies and industries based on their performance and ratio analysis will be
able to see a major shift in the ratios when debt and the capital (equity) are stated as per their substance and not form.
For example, a preference share which is compulsorily redeemable will now have to be classified as a debt rather than
equity as it represents an obligation on the issuer of the financial instrument to repay the money.
Read more: http://forbesindia.com/blog/business-strategy/ind-as-is-here-but-are-we-ready/#ixzz4AnBo8elY

CA. ASHWANI RASTOGI
Carve Outs
Use of carrying cost of Property, Plant and Equipment on the date of transition of First-time
Adoption of Ind AS is permitted. (Ind AS 101). i.e. W.D.V. as on 31.3.16 can be use as carrying
cost for ppe
Bargain purchase gain arising on a business combination to be treated as Capital Reserve under
Ind AS. (Ind AS 103)
Fair value model for investment property not permitted. (Ind AS 40)
Uniform accounting policies may not be used by investor of an associate in case it is impracticable. (Ind AS 28)
Classification of Foreign Currency Convertible Bonds (Ind AS 32, Financial Instruments:
Presentation)
Permission to continue with the accounting policy adopted for amortization of intangible assets
arising from service concession arrangements related to toll roads (Ind AS 101 and Ind AS 38)
Classification of a loan liability in case of breach of a loan condition (Ind AS 1)
Carve-out regarding recognition of lease rentals (Ind AS 17, Leases)
Permission to continue the accounting policy adopted for accounting for exchange differences
arising from translation of long-term foreign currency monetary items (Ind AS 101 and Ind AS 21)

CA. ASHWANI RASTOGI
IND Notified by MCA,
Recently IND AS 115 replaced by IND AS 11 & 18
Framework Framework for the Preparation and Presentation of
Financial Statements in accordance with Indian
Accounting Standards
Ind AS 101 First-time Adoption of Indian Accounting Standards
Ind AS 102 Share based Payment
Ind AS 103 Business Combinations
Ind AS 104 Insurance Contracts
Ind AS 105 Non-current Assets Held for Sale and Discontinued
Operations
Ind AS 106 Exploration for and Evaluation of Mineral Resources
Ind AS 107 Financial Instruments: Disclosures
Ind AS 108 Operating Segments
Ind AS 109 Financial Instruments
Ind AS 110 Consolidated Financial Statements
Ind AS 111 Joint Arrangements
Ind AS 112 Disclosure of Interests in Other Entities
Ind AS 113 Fair Value Measurement
Ind AS 114 Regulatory Deferral Accounts
Ind AS 1 Presentation of Financial Statements
Ind AS 2 Inventories
Ind AS 7 Statement of Cash Flows
Ind AS 8 Accounting Policies, Changes in Accounting Estimates
and Errors
Ind AS 10 Events after the Reporting Period
Ind AS 11 Construction Contracts
Ind AS 12 Income Taxes

CA. ASHWANI RASTOGI
Ind AS 16 Property, Plant and Equipment
Ind AS 17 Leases
Ind AS 18 Revenue
Ind AS 19 Employee Benefits
Ind AS 20 Accounting for Government Grants and Disclosure of
Government Assistance
Ind AS 21 The Effects of Changes in Foreign Exchange Rates
Ind AS 23 Borrowing Costs
Ind AS 24 Related Party Disclosures
Ind AS 27 Consolidated and Separate Financial Statements
Ind AS 28 Investments in Associates
Ind AS 29 Financial Reporting in Hyperinflationary Economies
Ind AS 32 Financial Instruments: Presentation
Ind AS 33 Earnings per Share
Ind AS 34 Interim Financial Reporting
Ind AS 36 Impairment of Assets
Ind AS 37 Provisions, Contingent Liabilities and Contingent
Assets
Ind AS 38 Intangible Assets
Ind AS 40 Investment Property

CA. ASHWANI RASTOGI
KEY IND AS STANDARDS WITH AN IMPACT
Ind AS 1 : Presentation of Financial Statements
Ind AS 10 : Events after Reporting Period
Ind AS12 : Income Taxes
Ind AS 18 : Revenue
Ind AS 19 : Employee Benefits
Ind AS 28 : Investment in Associates and Joint Ventures
Ind AS 37 : Provisions, Contingent Liabilities and Contingent Assets
Ind AS 38 : Intangible Assets
Ind AS 101 : First-time Adoption of Indian Accounting Standards
Ind AS 102 : Share-based Payment
Ind AS 108 : Operating Segments
Ind AS 109 : Financial Instruments

CA. ASHWANI RASTOGI
Ind AS 1 : Presentation of Financial Statements
New Components of Financial Statements
-Statement of Changes in Equity for the year.
-‘Other Comprehensive Income’ section in the Statement of Profit and Loss for the year.
Distinction between Financial and Non-Financial assets/liabilities
Illustrative examples of financial and non-financial assets/liabilities :
Identified non-financial assets
•Advances for raw material
•Capital advances etc.
•Identified financial assets
•Investments
•Trade receivables
•Identified financial liabilities
•Security Deposits
•Trade payables etc.
•Identified non-financial liabilities
•Statutory dues
•Advances from customers
Other Changes –The standard requires few other disclosures like capital management, sources of
estimation uncertainty etc. in the financial statements of the Company.

CA. ASHWANI RASTOGI
OTHER COMPREHENSIVE INCOME (OCI)
•Other comprehensive income comprises items of income and expense that are not recognised in profit
or loss as required or permitted by other Ind AS.
•OCI balance is presented in the ‘Other Equity’section of the Balance Sheet separately from retained
earnings.
Components of Other Comprehensive Income of an organization can be classified as:-
Items that cannot be reclassified to Profit or Loss:
-Re-measurements of defined benefit plans
Items that can be reclassified to Profit or Loss:
-Gains and losses on financial assets other than equity instruments measured at fair value through
other comprehensive income
Ind AS mandates ‘Single Statement’ approach which means that the Statement of Profit and Loss and
Other Comprehensive Income are to be presented in a single statement with two sections.

CA. ASHWANI RASTOGI
Ind AS 10 : Events after Reporting Period
IGAAP Ind AS
The Company accounted for a provision for
proposed final dividend (including dividend
distribution tax) relating to a given financial
year in that year, even if the approval of that
dividend by the shareholders took place after
the balance sheet date.
The Company will recognise a liability for final
dividend (including dividend distribution tax) in
the period when the dividends are approved by
the shareholders.
IMPACT
B/S
The charge to retained earnings amounting recognised for proposed final dividend and dividend
distribution tax under IGAAP is reversed in the opening B/S i.e. as on 1.4.2015.
Significant changes in % ‘Return on Capital Employed’ and ‘Return on Net Worth’ due to increase in
capital employed/net worth as at the Balance Sheet date..

CA. ASHWANI RASTOGI
Ind AS 12 : Income Taxes
IGAAP Ind AS
Deferred taxes are recognised for the tax effect
of timing differences between accounting
income and taxable income for the year i.e.,
income statement approach
Deferred taxes are recognised for future tax
consequences of temporary differences between
the carrying value of assets and liabilities in
books and their respective tax base i.e., balance
sheet approach.
IMPACT
B/S
Increases / Reduction in deferred tax assets with corresponding charge to retained earnings and OCI
reserve consequential to Ind AS adjustments.
P/L
Recognition of additional deferred tax expense in the profit and loss and a credit in OCI consequential
to Ind AS adjustments in JQ’16.

CA. ASHWANI RASTOGI
Ind AS 18: Revenue
IGAAP Ind AS
Under IGAAP, the
Company accounted
for revenue net of trade
discounts, sales taxes
and excise duties. OR
some other method
*New Revenue Definition –The Company will recognise revenue at the fair value
of consideration received or receivable. Any sales incentive, discounts or
rebates in any form, including cash discounts given to customers will be
considered as selling price reductions and accounted as reduction from
revenue. Under IGAAP, some of these costs were included in ‘advertising and
sales promotion’ expenses.
*Gross Vs Net Presentation –Excise duty will not be netted from revenue and
shown as a part of expenses.
IMPACT
P/L
Net revenue to be change, in JQ’16 ‘revenue from operations’
-Increase in revenue due to excise duty grossing up:
-Decrease in revenue due to reclassification from advertising and sales promotion:
Increase in ‘cost of material consumed’ due to inclusion of excise duty.
Impact on quarterly published results w.r.t excise duty presentation based on SEBI format for Ind AS
compliant companies to be assessed.
No impact on profit.
GST could also have implications once effective.

CA. ASHWANI RASTOGI
Ind AS 19 : Employee Benefits
IGAAP Ind AS
The Company recognised the investment in the
Trust as non-current investment at cost, as it did
not qualify as ‘plan asset’ under AS 15 on employee
benefits.
Trust qualifies and will be recognised as a ‘plan
asset’ under Ind AS 19.
The interest cost on defined benefit liability
and expected return on plan assets is
recognised as employee benefit expenses.
The Company may adopt an accounting policy
choice to recognise the net interest cost on
net defined benefit liabilities as finance cost.
Actuarial gains/losses is recognised an
'exceptional item’ in profit and loss.
Remeasurement of the net defined benefit
liability/(asset) will be recognised in ‘Other
Comprehensive Income’.
IMPACT
B/S
Changes in non-current investment due to reclassification trust as ‘plan asset’, netted off against
the provision for employee benefits.
P/L
Increase in finance cost in JQ’16 due to reclassification of net interest cost from employee benefit
expense. No impact on profit.
No impact taken in profit on account of reclassification of actuarial gain/loss to OCI in JQ’16.

CA. ASHWANI RASTOGI
Ind AS 28 : Investments in Associates and Joint Ventures
IGAAP Ind AS
The Company used ‘proportionate consolidation’
method to account for some of its joint venture in
its consolidated financial statements
The Company will account for its joint venture,
using the ‘equity method’ in its consolidated
financial statements
IMPACT
B/S
No line-by-line proportionate consolidation in the consolidated financial statements. Investment in
JV will appear as a single line item at cost plus holding’s share in the profit or loss post acquisition.
No impact on holding’s standalone financial statements. Investment in JV will continue to be
accounted at cost less impairment loss.

CA. ASHWANI RASTOGI
Ind AS 37 : Provisions, Contingent Liabilities and Contingent Assets
IGAAP Ind AS
The Company recognised provisions at an
undiscounted value as current IGAAP principles
explicitly prohibit discounting.
The Company will discount provisions to their
present value where the effect of time value of
money is material.
The increase in the provision due to the
passage of time will be recognised as finance
cost resulting in higher interest cost.
IMPACT
B/S
Impact of discounting of long term provisions and other non-current liabilities has been reduced from
long term provisions and other non-current liabilities respectively and with a corresponding increase in
retained earnings.
P/L
Increase in finance cost in JQ’16 due to unwinding of discount of the long term provisions and other
non-current liabilities.

CA. ASHWANI RASTOGI
Ind AS 38: Intangible Assets
IGAAP Ind AS
The useful life of an intangible asset cannot be
indefinite under IGAAP principles. The Company
amortised brand/trademark on a straight line
basis at 25% amortisation rate.
The useful of an intangible asset like
brand/trademark can be indefinite. Not required
to be amortised and only tested for impairment.
The Company amortised goodwill on a straight
line basis at 25% amortisation rate.
Goodwill arising on business combination
cannot be amortised and is only tested for
impairment.
IMPACT
B/S
No impact on Ind AS opening B/S and JQ’16 P/L.
P/L
Any brand/trademark having indefinite useful life or goodwill arising from future transactions will not be
amortised and only tested for impairment.

CA. ASHWANI RASTOGI
Ind AS 101: First-time Adoption of Indian Accounting Standards
The standard setting out how to adopt Ind AS for the first time –first time adoption rules, exemptions
and options that may be various carve out.
General Principle
Full retrospective application
of Ind AS in preparation of
opening Ind AS B/S as at
the date of transition i.e.,
1.04.2015
The Company may elect to apply the following optional exemptions in preparation of its Ind AS opening
Balance Sheet:
Recognise assets and liabilities as required by Ind AS.
Derecognise assets and liabilities not permitted by Ind
AS.
Reclassify assets, liabilities or components of equity in
accordance with Ind AS.
Measure all assets and liabilities in accordance with Ind
AS.
Consider mandatory and optional exemptions from
retrospective application.

CA. ASHWANI RASTOGI
Ind AS 102: Share-based Payment
IGAAP Ind AS
The Company accounted for equity settled
stock options under the ‘intrinsic value’ method
and made fair value disclosures.
The Company will account for equity settled
stock options using the ‘fair value’ method.
Under this method, compensation cost for the
employees’ stock options will be recognized
based on the fair value at the date of grant in
accordance with the Black Scholes model.
IMPACT
B/S
The reduction/ changes in employee compensation cost for the unvested options as on the date of
transition based on fair value method which has been debited /credited to retained earnings.
P/L
The reduction in employee compensation cost for JQ’16 based on fair value method debited/ credited to
employee benefit expense.

CA. ASHWANI RASTOGI
Ind AS 108: Operating Segments
IGAAP Ind AS
RISK AND RETURN APPROACH :Identification
of two sets of segments—one based on related
products and services, and the other on
geographical areas based on the 'risks and
returns' approach.
Currently, the segments reported are various
business and Indian operation and overseas
operation
MANAGEMENT APPROACH : Identification
based on the manner in which the entity’s
'Chief Operating Decision Maker' (CODM)
reviews the business components regularly to
make decisions about allocating resources to
segments and in assessing their performance.
Segments need to be consistent with the
internal organization structure and internal
reporting used for decision making by CODM.
IMPACT
No financial impact on the financial statements as this is a disclosure related standard.
The company is assessing and evaluating the impact of the CODM approach as required by this
standard on its segments reported currently.

CA. ASHWANI RASTOGI
Ind AS 109: Financial instruments
IGAAP Ind AS
The Company currently accounts for current
investments at lower of cost and fair value. The Company will account for its investments
(i.e., treasury bills, government securities and
mutual funds) at fair value.
The investments will be classified as either
Fair Value through the Profit or Loss (FVTPL) or
Fair Value through the Other Comprehensive
Income (FVOCI) depending on the nature of
investment.
IMPACT
B/S
The impact of fair valuation of the Company’s investments will directly impact retained earnings and OCI
reserve.
P/L
Increase/(decrease) in ‘other income’ and ‘other comprehensive income’ and respectively will change on
account of fair valuation gain/(loss) on the Company’s investments for JQ’16.

CA. ASHWANI RASTOGI
Thank You
CA. Ashwani Rastogi
M.Com., CA, CS.
Certification Course on InternationalTaxation, IFRS, BSE (Mumbai)
Sr. Partner, Singh Agarwal & Co., Chartered Accountants
A – 112 Jain Park, Uttam Nagar, New Delhi - 110059
M - 9990999281 Email- ashwani.rastogi.ca@gmail.com
www.cacertification.com
Visiting Faculty, ICAI ICWAI, & ICSI
New Delhi

Al
(A)
1
2
(B)
1
2
3
Appe
so openin
P
Non-curren
(a) Prop
(b) Cap
(c) Inve
(d) Goo
(e) Oth
(f) Inta
developmen
(g) Fina
1)In
2)Tr
3)Lo
(h) Def
(i) Othe
Current as
(a) Inve
(b) Fina
1)In
2)Tr
3)Lo
4)C
(c) Cur
(d) Oth
EQU
Equity
(a) Equ
(b) Oth
Non-curren
(a) Fina
1)B
2)Tr
(b) Prov
(c) Defe
(d) Oth
Current lia
(a) Fina
(b) Prov
(c) Oth
endix- DRA
BA
ng BS 1.4.
Particulars
ASSETS
nt assets
perty, plant
pital work-in
estment Pro
odwill
her Intangib
angible asse
nt
ancial Asse
nvestment
rade Receiv
oans
ferred tax as
er non-curr
ssets
entories
ancial Asse
nvestment
rade Receiv
oans
Cash and ca
rrent Tax As
her current
UITY AND L
uity Share c
her Equity
nt liabilitie
ancial Liabi
Borrowings
rade Payab
vision
erred tax lia
her non-cur
abilities
ancial Liabi
vision
her non-curr
Significan
AFT BALAN
ALANCE
15 to prep
s
t and Equip
n-progress
operty
ble assets
ts under
ts
vables
ssets (net)
rent assets
ets
vables
ash equivale
ssets (Net)
assets
LIABILITIES
capital
es
ilities
les
abilities (Ne
rrent liabilit
ilities
rent liabiliti
nt accounti
NCE SHEET
E SHEET
pare| Re-c
pment
ents
S
et)
ties
ies
ing policies
T AS PER IN
T AS AT
class India
Note No.
TOTAL
TOTAL
s
ND-AS NOT
T MARCH
an IGAAP
As a
Ma
20
TIFIED BY
H 31, 20
| IND AS
at 31
arch,
017
0
0
0
0
MCA DIVIS
017
S Adjustm
As at 3
March
2016
SION II
ment | IND
1
,
A
0
0
0
0
D-AS
As at 01
April,
2015
0
0
0
0

(A)
I.
II
(B)
Co
Pu
Ch
in-
Em
Fin
De
Oth
(C)
ext
(D)
(E)
(F)
(G)
(F)
(I)
(II
(III
(H)
(I)
S
REVENUE
Revenue f
. Other Inco
Expenses:
st of materi
rchase of S
hanges in in
progress an
mployee ben
nancial cost
preciation a
her expense
) Profit befo
traordinary
) Exception
Profit befo
Extraordin
) Profit befo
Tax expen
Current ta
) Deferred t
I) MAT cred
) PROFIT A
Earning pe
(I) Basic
(II) Dilute
TATEMENT
Partic
E
from operat
ome
:
ials consum
tock-in-Tra
nventories o
nd Stock-in
nefit expens
ts
and amortiz
es
ore excepti
y items and
nal Items
ore extraor
nary Items
fore tax
nse:
ax
tax
dit
AFTER TAX
er equity sh
ed
Mobile 9
T OF PROF
culars
tions
To
med
ade
f finished g
n-Trade
e
zation expen
Tot
ional and
d tax
rdinary item
s
X
hare:
CA. A
9990999281
FIT AND LO
otal Revenu
goods, work
nse
tal Expense
ms and tax
ASHWANI RA
1‐ ashwani.ra
OSS FOR T
Note
ue
-
es
x
STOGI
astogi.ca@gm
THE PERIO
No
3
mail.com
OD ENDED
As at
31 March,
MARCH 3
2017
0
0
0
0
0
1, 2017
As
31 March
at
h, 2016
0
0
0
-
0
-
0

IND AS Implementation

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (20)

Similar to IND AS Implementation

Similar to IND AS Implementation (20)

More from Ashwani Rastogi

More from Ashwani Rastogi (7)

Recently uploaded

Recently uploaded (20)

IND AS Implementation