accounting standard
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Accounting Standard 26 outlines standards for intangible assets. It defines intangible assets as non-physical assets including scientific/technical knowledge, software, patents, trademarks and more. It provides guidance on primary and secondary recognition of intangible assets acquired through purchase, amalgamation, government grants, or asset exchanges. It also addresses treatment of research and development expenditures. The standard specifies acceptable methods for amortizing intangible assets over their useful lives.
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As26
Intangible assets are non-physical assets that provide future economic benefits such as goodwill, patents, trademarks, and software. Examples of intangible assets include goodwill, patents, knowhow, trademarks, and software/websites. Preliminary expenses, advertisement suspense accounts, and other deferred revenue expenditures are not considered intangible assets. Purchased intangible assets should be recorded at cost, while exchanged intangible assets should be recorded at the fair value of the asset surrendered or received, whichever is more evident. Self-generated intangible assets capitalize development expenditures once technical feasibility and intent to complete have been established. Intangible assets should be amortized in a manner consistent with the
Ind as 16
This document discusses accounting for property, plant, and equipment (PPE) under Indian Accounting Standard (Ind AS) 16. It covers topics such as the initial recognition and measurement of PPE, the cost model and revaluation model for subsequent measurement, depreciation, and impairment. It also provides examples of accounting entries for revaluation of PPE and disclosure requirements related to PPE under Ind AS 16.
AS-26 intangible assets.pptx
This document defines intangible assets and provides guidance on their recognition, measurement, amortization and disclosure. Key points include: intangible assets lack physical substance but provide future economic benefits; recognition criteria are future benefits are probable and cost reliably measured; measurement depends on whether asset is internally generated or acquired; amortization period generally does not exceed 10 years; expenditures that maintain asset value are expensed while those that increase benefits are capitalized. Significant differences between Ind AS 38 and AS 26 are also outlined.
As 10
This document provides an overview of Accounting Standard 10 (AS 10) regarding accounting for fixed assets in India. AS 10 applies to companies listed on a recognized stock exchange and large commercial enterprises. It defines fixed assets as assets used for producing goods and services, not held for sale. It discusses the components that make up the cost of a fixed asset, treatment of improvements and repairs, and disclosure requirements regarding fixed assets in financial statements.
Ind AS 16 on PPE
This document provides an overview of Ind AS 16 - Property, Plant and Equipment. It begins by outlining the basics of how an Ind AS is framed, including its framework, objective, scope and definitions. It then discusses the key aspects of Ind AS 16 related to recognition, measurement, de-recognition and disclosures of property, plant and equipment. Specific topics covered include initial and subsequent measurement at cost, the component approach, the revaluation model, and accounting for dismantling costs. Worked examples are provided to illustrate the accounting treatment. The document aims to explain the principles and application of Ind AS 16 for property, plant and equipment.
Ind AS 16
This document discusses the key aspects of IND AS 16 regarding the accounting treatment of property, plant, and equipment. It covers the scope of IND AS 16, initial recognition and measurement of PPE at cost, subsequent measurement using either the cost or revaluation model, and depreciation of PPE over its useful life. PPE are tangible assets held for use in production, rental, or administration that are expected to be used for more than one period.
Ind as 38
This document provides an overview of Ind AS 38 on Intangible Assets. It discusses the objective and scope, key definitions, recognition and measurement criteria, disclosure requirements, and differences between Ind AS 38 and the previous Accounting Standard AS 26. Some of the key points covered include defining an intangible asset, the criteria for recognition of intangible assets, measurement at cost or revaluation model, amortization periods, impairment testing, and additional disclosures required under Ind AS 38.
Ind as 23 borrowing costs
IND AS 23 prescribes the accounting treatment for borrowing costs. It states that borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset should be capitalized as part of the cost of that asset, while other borrowing costs are recognized as an expense. A qualifying asset is defined as an asset that takes a substantial period of time to get ready for its intended use or sale. The standard provides guidance on capitalizing eligible borrowing costs, suspending and recommencing capitalization, and required disclosures. It aims to outline a principles-based approach to borrowing cost treatment.
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As26
Intangible assets are non-physical assets that provide future economic benefits such as goodwill, patents, trademarks, and software. Examples of intangible assets include goodwill, patents, knowhow, trademarks, and software/websites. Preliminary expenses, advertisement suspense accounts, and other deferred revenue expenditures are not considered intangible assets. Purchased intangible assets should be recorded at cost, while exchanged intangible assets should be recorded at the fair value of the asset surrendered or received, whichever is more evident. Self-generated intangible assets capitalize development expenditures once technical feasibility and intent to complete have been established. Intangible assets should be amortized in a manner consistent with the
Ind as 16
This document discusses accounting for property, plant, and equipment (PPE) under Indian Accounting Standard (Ind AS) 16. It covers topics such as the initial recognition and measurement of PPE, the cost model and revaluation model for subsequent measurement, depreciation, and impairment. It also provides examples of accounting entries for revaluation of PPE and disclosure requirements related to PPE under Ind AS 16.
AS-26 intangible assets.pptx
This document defines intangible assets and provides guidance on their recognition, measurement, amortization and disclosure. Key points include: intangible assets lack physical substance but provide future economic benefits; recognition criteria are future benefits are probable and cost reliably measured; measurement depends on whether asset is internally generated or acquired; amortization period generally does not exceed 10 years; expenditures that maintain asset value are expensed while those that increase benefits are capitalized. Significant differences between Ind AS 38 and AS 26 are also outlined.
As 10
This document provides an overview of Accounting Standard 10 (AS 10) regarding accounting for fixed assets in India. AS 10 applies to companies listed on a recognized stock exchange and large commercial enterprises. It defines fixed assets as assets used for producing goods and services, not held for sale. It discusses the components that make up the cost of a fixed asset, treatment of improvements and repairs, and disclosure requirements regarding fixed assets in financial statements.
Ind AS 16 on PPE
This document provides an overview of Ind AS 16 - Property, Plant and Equipment. It begins by outlining the basics of how an Ind AS is framed, including its framework, objective, scope and definitions. It then discusses the key aspects of Ind AS 16 related to recognition, measurement, de-recognition and disclosures of property, plant and equipment. Specific topics covered include initial and subsequent measurement at cost, the component approach, the revaluation model, and accounting for dismantling costs. Worked examples are provided to illustrate the accounting treatment. The document aims to explain the principles and application of Ind AS 16 for property, plant and equipment.
Ind AS 16
This document discusses the key aspects of IND AS 16 regarding the accounting treatment of property, plant, and equipment. It covers the scope of IND AS 16, initial recognition and measurement of PPE at cost, subsequent measurement using either the cost or revaluation model, and depreciation of PPE over its useful life. PPE are tangible assets held for use in production, rental, or administration that are expected to be used for more than one period.
Ind as 38
This document provides an overview of Ind AS 38 on Intangible Assets. It discusses the objective and scope, key definitions, recognition and measurement criteria, disclosure requirements, and differences between Ind AS 38 and the previous Accounting Standard AS 26. Some of the key points covered include defining an intangible asset, the criteria for recognition of intangible assets, measurement at cost or revaluation model, amortization periods, impairment testing, and additional disclosures required under Ind AS 38.
Ind as 23 borrowing costs
IND AS 23 prescribes the accounting treatment for borrowing costs. It states that borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset should be capitalized as part of the cost of that asset, while other borrowing costs are recognized as an expense. A qualifying asset is defined as an asset that takes a substantial period of time to get ready for its intended use or sale. The standard provides guidance on capitalizing eligible borrowing costs, suspending and recommencing capitalization, and required disclosures. It aims to outline a principles-based approach to borrowing cost treatment.
Ind AS Financial Statements
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Accounting Standard - 28 Impairment Of Assets
This document provides an overview of Accounting Standard 28 regarding impairment of assets. It outlines the objective to ensure assets are carried at no more than their recoverable amount. The standard is applicable to companies listed or in the process of listing with a turnover over 50 crores from 2004, and all other enterprises from 2005. Assets should be tested for impairment if there are any internal or external indicators, such as obsolescence, declines in value or performance. The recoverable amount is the higher of an asset's net selling price or value in use, which is the present value of estimated future cash flows. Impairment losses must be accounted for when the recoverable amount is less than the carrying amount.
New borrowing cost ias 23
This document summarizes the key aspects of IAS 23 Borrowing Costs. It defines borrowing costs and qualifying assets. For qualifying assets, borrowing costs directly attributable to the acquisition or construction must be capitalized as part of the asset cost, while other borrowing costs are expensed. Capitalization begins when expenditures are incurred, borrowing costs are incurred, and activities necessary for intended use/sale begin, and ceases when activities are substantially complete. An entity must disclose the amount of borrowing costs capitalized and capitalization rate used.
Intangible Assets- IAS 38
A Presentation on Intangible Assets-IAS 38
Prepared by a few students of Dept. of Accounting & Info. Systems, Jahangirnagar University, Savar, Dhaka
Intangible assets ias 38
The document provides an overview of accounting for intangible assets under IAS 38. It discusses the definition of intangible assets, recognition criteria, measurement at cost or fair value, amortization of intangible assets with finite useful lives, impairment testing, and disclosure requirements. The document also covers topics such as government grants, internally generated intangible assets, revaluation model, and differences between IFRS and Indian GAAP treatment of intangible assets.
CONVERGENCE OF INDIAN ACCOUNTING STANDARDS WITH INTERNATIONAL FINANCIAL REPOR...
The document discusses the convergence of Indian Accounting Standards (Ind AS) with International Financial Reporting Standards (IFRS). It provides an overview of the need for IFRS, lists the various Ind AS and IFRS standards, and compares key differences between Indian Accounting Standards (AS) and Ind AS. The convergence roadmap for mandatory adoption of Ind AS by Indian companies of different sizes and industries at different time periods is also outlined. Some of the major differences highlighted between AS and Ind AS include the components of financial statements, treatment of extraordinary items and prior period errors, and accounting for proposed dividends and financial liability classification.
Revenue recognition AS-9
This document discusses accounting standard 9 regarding revenue recognition. It defines revenue as the gross inflow of cash or receivables from the sale of goods, rendering of services, or use of enterprise resources by others. Revenue is recognized when it is earned and realizable, following the revenue recognition and matching principles. The standard provides criteria for revenue recognition such as evidence of an arrangement, delivery, fixed pricing, and collectability. It also discusses types of revenue recognition for different transactions and the effect of uncertainties.
As 1
The document discusses accounting standards and the disclosure of accounting policies. It states that accounting standards aim to harmonize diverse accounting policies to make financial reporting more useful and effective. It also notes that disclosure of accounting policies is important to ensure a proper understanding of financial statements and facilitate meaningful comparison. The disclosure should form part of the financial statements and explain all significant policies, including any changes, at one place.
Valuation of investments
The document discusses accounting standards for investments in India. It covers the meaning and significance of investments, the scope and coverage of the accounting standard, forms of investments, principles and norms for valuation and classification of investments, disclosure requirements, and examples of types of investments held by Indian companies. The key principles are that current investments are carried at fair value and long-term investments at cost, and gains or losses on disposal of investments are recorded in the profit and loss statement.
Ind AS 23 - Borrowing Costs
Ind AS 23 establishes the accounting requirements for borrowing costs. The core principle is that borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset must be capitalized as part of the cost of that asset. A qualifying asset takes substantial time to get ready for use or sale. Borrowing costs include interest expense, finance charges, and exchange differences arising from foreign currency borrowings to the extent they are treated as an adjustment to interest costs. Borrowing costs must be capitalized when funds are borrowed specifically for a qualifying asset or as part of general borrowings used for qualifying assets. Capitalization should cease when substantially all activities to prepare the asset are complete.
Accounting standard 2
This document discusses the valuation and accounting of inventory. It defines inventory as assets held for sale, in production, or as supplies. Inventory should be valued at the lower of cost or net realizable value. Cost includes all purchase costs, conversion costs like direct labor and allocated overheads, and other costs to bring inventory to its present condition. Common costing methods are specific identification, FIFO, and weighted average. Disclosures include accounting policies and total inventory carrying amounts.
New ias 36
This document summarizes the key aspects of IAS 36 regarding impairment of assets. IAS 36 aims to ensure assets are not carried at more than their recoverable amount. It defines terms like carrying amount, cash-generating units and impairment loss. The standard outlines how to identify impaired assets, measure recoverable amount, recognize impairment losses, allocate losses to cash-generating units including goodwill, and reverse impairment losses. Entities must disclose impairment losses, reversals and reasons for changes in carrying amounts.
Accounting Standard 10 (PPE)
This document summarizes Accounting Standard 10 on Property, Plant and Equipment. It describes the objectives, scope, definitions and accounting treatment for PPE. Key points include: the standard establishes principles for recognition, measurement, presentation and disclosure of PPE; assets qualifying as PPE must be held for use in production or supply of goods/services and have a useful life of more than one year; PPE is initially measured at cost and subsequently using either the cost or revaluation model; depreciation is charged over the useful life of an asset using methods like straight line or diminishing balance; and gains or losses on disposal of PPE are included in profit or loss.
Ind as 36
This document provides an overview of Ind AS 36 - Impairment of Assets. It begins with an agenda outlining the key topics to be covered, including objective and scope, definitions, recognition and measurement requirements, required disclosures, differences between Ind AS 36 and the corresponding Indian accounting standard AS 28, and the potential impact on ILGIC. Some of the main points covered include: assets within the scope of Ind AS 36, the definition of impairment and key terms, procedures for identifying and measuring impairment losses, impairment loss allocation methods, and additional annual testing required under Ind AS 36 for certain assets.
As 2
This document outlines accounting standards for valuing inventories. It defines inventories as assets held for sale, in production, or as materials used in production. Inventories should be valued at the lower of cost or net realizable value. Cost includes purchase price, conversion costs, and other costs to bring inventories to their present state. Net realizable value is estimated selling price less costs to complete and sell. Accepted cost flow methods for valuing inventories include FIFO, LIFO, and weighted average cost. Financial statements must disclose the accounting policy, cost formula used, and inventory classifications.
Holding company
A holding company owns shares of other companies to control them but does not produce goods or services itself. It allows ownership and control of multiple companies to reduce risk for owners. A holding company controls a subsidiary's board or holds over half its equity shares. Consolidating financial statements combines the holding company and subsidiaries' income statements and balance sheets, eliminating intercompany transactions and investments to show the group's overall operating results and financial position.
Cash flow statement AS-3
This presentation is on Accounting Standard - 3 Cash Flow Statement issued by Institute of Chartered Accountants of India.
Ind as 36 Impairment of Assets
Throwing the light on almost every aspect of Ind AS -36 & key differences between AS - 28 & Ind AS 36
Ppt on accounting standards
The document provides an overview of accounting standards in India and other countries. It discusses 32 accounting standards issued by the Institute of Chartered Accountants of India that are based on the 41 International Financial Reporting Standards. The standards cover various topics such as disclosure of accounting policies, treatment of inventories, cash flow statements, revenue recognition, accounting for fixed assets, foreign exchange rates, and financial instruments. The objectives, evolution, and key aspects of many individual accounting standards are summarized.
Accounting Standard 4
This document outlines Accounting Standard 26 regarding the accounting treatment for intangible assets in India. Key points include:
- The standard defines intangible assets and provides examples such as goodwill, research and development expenses, patents, and copyrights.
- Intangible assets must meet certain recognition criteria to be recorded, including being identifiable, lacking physical substance, and providing future economic benefits.
- Internally generated intangible assets are classified as research or development phases, with development costs capitalized if certain conditions are met.
- Intangible assets are initially measured at cost and amortized over their estimated useful lives not to exceed 10 years, generally using the straight-line method.
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Working capital management
The study analyzed the impact of working capital management on the profitability of 58 small manufacturing firms in Mauritius over the period of 1998-2003. The results showed that return on total assets, a measure of profitability, was positively correlated with measures of working capital management efficiency like accounts receivable days and cash conversion cycle. However, it was negatively correlated with accounts payable days. The paper concluded that synchronizing current assets and liabilities is important for small firm profitability and the paper industry showed best practices in working capital management.
Accounting Standard - 28 Impairment Of Assets
This document provides an overview of Accounting Standard 28 regarding impairment of assets. It outlines the objective to ensure assets are carried at no more than their recoverable amount. The standard is applicable to companies listed or in the process of listing with a turnover over 50 crores from 2004, and all other enterprises from 2005. Assets should be tested for impairment if there are any internal or external indicators, such as obsolescence, declines in value or performance. The recoverable amount is the higher of an asset's net selling price or value in use, which is the present value of estimated future cash flows. Impairment losses must be accounted for when the recoverable amount is less than the carrying amount.
New borrowing cost ias 23
This document summarizes the key aspects of IAS 23 Borrowing Costs. It defines borrowing costs and qualifying assets. For qualifying assets, borrowing costs directly attributable to the acquisition or construction must be capitalized as part of the asset cost, while other borrowing costs are expensed. Capitalization begins when expenditures are incurred, borrowing costs are incurred, and activities necessary for intended use/sale begin, and ceases when activities are substantially complete. An entity must disclose the amount of borrowing costs capitalized and capitalization rate used.
Intangible Assets- IAS 38
A Presentation on Intangible Assets-IAS 38
Prepared by a few students of Dept. of Accounting & Info. Systems, Jahangirnagar University, Savar, Dhaka
Intangible assets ias 38
The document provides an overview of accounting for intangible assets under IAS 38. It discusses the definition of intangible assets, recognition criteria, measurement at cost or fair value, amortization of intangible assets with finite useful lives, impairment testing, and disclosure requirements. The document also covers topics such as government grants, internally generated intangible assets, revaluation model, and differences between IFRS and Indian GAAP treatment of intangible assets.
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The document discusses the convergence of Indian Accounting Standards (Ind AS) with International Financial Reporting Standards (IFRS). It provides an overview of the need for IFRS, lists the various Ind AS and IFRS standards, and compares key differences between Indian Accounting Standards (AS) and Ind AS. The convergence roadmap for mandatory adoption of Ind AS by Indian companies of different sizes and industries at different time periods is also outlined. Some of the major differences highlighted between AS and Ind AS include the components of financial statements, treatment of extraordinary items and prior period errors, and accounting for proposed dividends and financial liability classification.
Revenue recognition AS-9
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As 1
The document discusses accounting standards and the disclosure of accounting policies. It states that accounting standards aim to harmonize diverse accounting policies to make financial reporting more useful and effective. It also notes that disclosure of accounting policies is important to ensure a proper understanding of financial statements and facilitate meaningful comparison. The disclosure should form part of the financial statements and explain all significant policies, including any changes, at one place.
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The document discusses accounting standards for investments in India. It covers the meaning and significance of investments, the scope and coverage of the accounting standard, forms of investments, principles and norms for valuation and classification of investments, disclosure requirements, and examples of types of investments held by Indian companies. The key principles are that current investments are carried at fair value and long-term investments at cost, and gains or losses on disposal of investments are recorded in the profit and loss statement.
Ind AS 23 - Borrowing Costs
Ind AS 23 establishes the accounting requirements for borrowing costs. The core principle is that borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset must be capitalized as part of the cost of that asset. A qualifying asset takes substantial time to get ready for use or sale. Borrowing costs include interest expense, finance charges, and exchange differences arising from foreign currency borrowings to the extent they are treated as an adjustment to interest costs. Borrowing costs must be capitalized when funds are borrowed specifically for a qualifying asset or as part of general borrowings used for qualifying assets. Capitalization should cease when substantially all activities to prepare the asset are complete.
Accounting standard 2
This document discusses the valuation and accounting of inventory. It defines inventory as assets held for sale, in production, or as supplies. Inventory should be valued at the lower of cost or net realizable value. Cost includes all purchase costs, conversion costs like direct labor and allocated overheads, and other costs to bring inventory to its present condition. Common costing methods are specific identification, FIFO, and weighted average. Disclosures include accounting policies and total inventory carrying amounts.
New ias 36
This document summarizes the key aspects of IAS 36 regarding impairment of assets. IAS 36 aims to ensure assets are not carried at more than their recoverable amount. It defines terms like carrying amount, cash-generating units and impairment loss. The standard outlines how to identify impaired assets, measure recoverable amount, recognize impairment losses, allocate losses to cash-generating units including goodwill, and reverse impairment losses. Entities must disclose impairment losses, reversals and reasons for changes in carrying amounts.
Accounting Standard 10 (PPE)
This document summarizes Accounting Standard 10 on Property, Plant and Equipment. It describes the objectives, scope, definitions and accounting treatment for PPE. Key points include: the standard establishes principles for recognition, measurement, presentation and disclosure of PPE; assets qualifying as PPE must be held for use in production or supply of goods/services and have a useful life of more than one year; PPE is initially measured at cost and subsequently using either the cost or revaluation model; depreciation is charged over the useful life of an asset using methods like straight line or diminishing balance; and gains or losses on disposal of PPE are included in profit or loss.
Ind as 36
This document provides an overview of Ind AS 36 - Impairment of Assets. It begins with an agenda outlining the key topics to be covered, including objective and scope, definitions, recognition and measurement requirements, required disclosures, differences between Ind AS 36 and the corresponding Indian accounting standard AS 28, and the potential impact on ILGIC. Some of the main points covered include: assets within the scope of Ind AS 36, the definition of impairment and key terms, procedures for identifying and measuring impairment losses, impairment loss allocation methods, and additional annual testing required under Ind AS 36 for certain assets.
As 2
This document outlines accounting standards for valuing inventories. It defines inventories as assets held for sale, in production, or as materials used in production. Inventories should be valued at the lower of cost or net realizable value. Cost includes purchase price, conversion costs, and other costs to bring inventories to their present state. Net realizable value is estimated selling price less costs to complete and sell. Accepted cost flow methods for valuing inventories include FIFO, LIFO, and weighted average cost. Financial statements must disclose the accounting policy, cost formula used, and inventory classifications.
Holding company
A holding company owns shares of other companies to control them but does not produce goods or services itself. It allows ownership and control of multiple companies to reduce risk for owners. A holding company controls a subsidiary's board or holds over half its equity shares. Consolidating financial statements combines the holding company and subsidiaries' income statements and balance sheets, eliminating intercompany transactions and investments to show the group's overall operating results and financial position.
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Ind as 36 Impairment of Assets
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Ppt on accounting standards
The document provides an overview of accounting standards in India and other countries. It discusses 32 accounting standards issued by the Institute of Chartered Accountants of India that are based on the 41 International Financial Reporting Standards. The standards cover various topics such as disclosure of accounting policies, treatment of inventories, cash flow statements, revenue recognition, accounting for fixed assets, foreign exchange rates, and financial instruments. The objectives, evolution, and key aspects of many individual accounting standards are summarized.
Accounting Standard 4
This document outlines Accounting Standard 26 regarding the accounting treatment for intangible assets in India. Key points include:
- The standard defines intangible assets and provides examples such as goodwill, research and development expenses, patents, and copyrights.
- Intangible assets must meet certain recognition criteria to be recorded, including being identifiable, lacking physical substance, and providing future economic benefits.
- Internally generated intangible assets are classified as research or development phases, with development costs capitalized if certain conditions are met.
- Intangible assets are initially measured at cost and amortized over their estimated useful lives not to exceed 10 years, generally using the straight-line method.
As 26 vs ind as-38
The document compares the accounting treatment of intangible assets under Indian Accounting Standard 38 (Ind AS 38) and the existing Accounting Standard 26 (AS 26).
Some key differences highlighted are: (1) Ind AS 38 provides more detailed guidance around identifiability, amortization methods including revenue-based amortization, treatment of intangibles acquired in business combinations etc. (2) Ind AS 38 recognizes that useful life of intangible assets can be indefinite, unlike the assumption of finite life under AS 26 (3) Ind AS 38 provides guidance on aspects like cessation of capitalization, de-recognition etc. which is not present in AS 26.
Overall, Ind AS 38
As 13
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Intangible assets
1) Intangible assets are non-physical assets that provide long-term benefits to a company such as patents, copyrights, and goodwill.
2) The costs of intangible assets are capitalized and amortized over the shorter of their legal or economic useful life. Amortization expense is recorded systematically over time.
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As 19
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Accounting standards ppt from 1 to 10
The document discusses Accounting Standards in India. It provides details on:
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2. There are currently 32 Accounting Standards in India based on International Accounting Standards. Other countries have adopted 41 International Financial Reporting Standards.
3. Key Accounting Standards cover topics like disclosure of accounting policies, valuation of inventories, cash flow statements, events after balance sheet date, components of profit and loss, depreciation methods, construction contracts, research and development costs, revenue recognition, and fixed assets.
Accounting standard
The document discusses the key aspects of Accounting Standard (AS) 26 on Intangible Assets. It outlines the objective, scope and definitions related to intangible assets. Specifically, it notes that an intangible asset must be identifiable, provide future economic benefits, and the enterprise must control it. The standard covers the recognition, measurement and subsequent expenditure and amortization of intangible assets. It does not apply to certain intangibles covered under other accounting standards.
As 29
The document discusses Accounting Standard 29 (AS-29) regarding provisions for contingent liabilities. It defines contingent liabilities as possible obligations arising from past events that will only be confirmed by uncertain future events outside the company's control. Provisions should be made for obligations from past events when a reliable estimate can be made and the obligation is likely to affect the company's finances. AS-29 requires contingent liabilities and provisions to be disclosed in footnotes, including estimates of financial effects and uncertainties for contingent liabilities, and details of movements in provisions. An example is given of a company providing a provision for a guarantee it gave on another company's loan.
As 9 Revenue Recognition
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This document provides an overview of Accounting Standard 10 (AS-10) regarding the accounting treatment of fixed assets. It defines fixed assets and outlines their presentation in financial statements using either historical cost or revalued amounts. The document discusses the calculation of historical cost, accounting for self-constructed and exchanged assets, and the treatment of revaluations. It also covers improvements, additions, disposals, and the required disclosures regarding fixed assets. The presentation was created by students at L.J Institute of Management Studies in Ahmedabad, Gujarat to explain AS-10 on accounting for fixed assets.
Accounting Standard 1
Accounting Standard 1 discusses the disclosure of accounting policies. Accounting policies refer to the specific principles and methods used to prepare financial statements, such as the methods of depreciation, treatment of construction expenditures, currency conversion, and inventory valuation. Disclosing all significant accounting policies together is helpful for readers to understand and compare financial statements. Fundamental assumptions like going concern, consistency, and accrual must be followed. Selection of policies should exhibit a true and fair view while considering prudence, substance over form, and materiality. Changes in policies are allowed if required by statute, compliance with standards, or to provide a more appropriate presentation.
As 16
Accounting Standard 16 outlines the accounting treatment for borrowing costs related to qualifying assets. It requires that borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset be capitalized as part of the cost of that asset. Other borrowing costs should be recognized as an expense. Capitalization of borrowing costs should commence when funds are borrowed and activities to prepare the asset are underway, and cease when the asset is ready for its intended use or sale. Certain disclosures regarding capitalized borrowing costs are also required.
Ias 38 intangibles
This document summarizes key differences between IFRS and US GAAP regarding accounting for intangible assets. Some of the main points covered include:
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- IFRS requires capitalization of development costs when technical and economic feasibility can be demonstrated, while most development costs are expensed under US GAAP.
- There have been efforts to converge the standards but projects to fully eliminate differences have not been undertaken.
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Revaluation of fixed assets involves adjusting the recorded value of a company's capital goods like machines, buildings, and patents to reflect their true market value. This is distinct from regular depreciation which ties asset value decline to age. Reasons for revaluation include showing accurate rates of return, maintaining adequate replacement funds, and negotiating fair sale prices. Common revaluation methods include indexation against cost inflation, appraising current market prices, and hiring experts. Any increase in value is recorded in a revaluation reserve rather than profits to avoid overstating earnings.
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fixed_assets_management.pptx
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accounting standard
- 1. Accounting Standard 26 Intangible Assets Javeed budhwani
- 2. Overview • Intangible asset has been defined as expenses incurred by companies on scientific technical knowledge, design and implementation of new processes or systems, licences intellectual property, trademarks, computer software, patents, copyrights, motion picture films, customer lists, mortgage, servicing rights, licenses, import quotas, franchisees. • The financial statements should disclose the aggregate amount of research and development expenditure and amortisation details of the assets.
- 3. • The standard will, however, not apply on certain intangible items like financial assets, mineral rights and expenditure on the exploration for, or development and extraction of minerals, oil, natural gas and similar non- regenerative resources and intangible assets arising in insurance enterprises from contracts with policyholders.
- 4. Valuation/Recognition of Intangible Assets 1. Primary Recognition (a) Acquired Intangible Assets (b) Self-Generated Intangible Assets 2. Secondary Recognition
- 5. Acquisition by way of Acquisition by way of Purchase Acquisition by way of Amalgamation Acquisition by way of Government Grant Acquisition by way of Exchange for another asset
- 6. Acquisition by way of Purchase • Purchase Cost • - Trade discount • + Taxes on purchase • - Refundable Taxes • + Installation Expenses • + Expenses on Valuation • + Any other directly attributable expense to make the asset ready for its intended use (e.g. professional fees or legal charges for aquisition of asset)
- 7. Acquisition by way of Amalgamation • Amalgamation in the • Amalgamation in the nature of Merger nature of Purchase ► at Book value ☞Fair Value of Intangible asset 1. Can be identified ► at Fair Value 2. Can’t be identified ► at such value due to which capital reserve does not arise or increase
- 8. Acquisition by way of Government Grant • at Nominal Value Acquisition by way of Exchange for another asset • at Fair Value of asset obtained or • at Fair Value of asset surrendered • whichever is more clearly evident. Note: if Fair Value is not clearly evident then consider lower value as value of intangible asset.
- 9. Self-generated Remaining self-generated intangible assets will be recognised. ▪ Expenditure on self-generated intangible asset is incurred in two phases. 1. Research Phase 2. Development Phase
- 10. Research Phase • Research expenditure means planned expenditure for gaining knowledge. • Expenditure during research phase will be charged to P&L A/c. It can never be reinstated as asset in future.
- 11. Development Phase • Development expenditure means expenditure incurred on application of already gained knowledge. • Expenditure during development phase will be capitalised as intangible asset till such asset is ready for use. • Maximum capitalisation <= Future Economic Benefits • Amount to be transferred to P&L A/c = Amount already capitalised + Expenditure incurred - Future Economic Benefits
- 12. Secondary Recognition Secondary Expenditure If it can be measured If it can’t be measured Whether such expenditure improves the performance of the asset Not recognised beyond standard performance yes no Capitalised Transfer to P&L A/c However, it is encouraged to write-off such expenditure to P&L A/c
- 13. Amortisation of Intangible Asset Amortisation of Intangible asset Method of amortisation Life of amortisation Scrap Value (in order of preference)
- 14. Method of amortisation (in order of preference) 1. Production unit method 2. SLM method 3. WDV method
- 15. Life of amortisation 1. Over a period of 10 years (including goodwill) 2. 3-5 years for software/website 3. As per AS-14 goodwill due to amalgamation will be written-off over a period of 5 years
- 16. Life of amortisation ★ Higher life can be considered if justified. ▪ Justification to be given in notes to accounts. ▪ Such higher life is considered as an indicator of impairment loss. ▪ If justification is not provided then Valuation as per AS-26 less: Book Value = written-off against opening revenue reserve ▪ If any intangible asset is not used, it is also an indicator of impairment loss.
- 17. Scrap Value Method of depreciation SLM WDV Scrap Value will be taken as nil 5% of cost (as per Sec. 205 of Companies Act unless there is a back price binding buy
- 18. • Method of amortisation, life of amortisation & scrap value will be reviewed every year. All effects will be on prospective basis. ★ Intangible assets can never be revalued in any case.
- 19. THANK YOU