Financial Reporting · Ind AS 105 Non-current Assets Held for Sale and Discontinued Operations

Ind AS 105 Presentation and Disclosure Requirements

Updated 5 October 2026 · Fact-checked

Under Ind AS 105, you show non-current assets (and disposal groups) held for sale separately from other assets, and their liabilities separately from other liabilities. You do not reclassify or restate prior-period balance sheet amounts. You then disclose the asset description, facts of the sale, any gain or loss, and the segment, in the notes.

Understand Presentation and Disclosure Requirements

Once an asset or disposal group is classified as held for sale, users need to see it apart from the assets you will keep using. So Ind AS 105 asks you to present it on its own line in the balance sheet.

A disposal group is a group of assets to be disposed of together in one transaction, with the liabilities directly associated with them. Assets of the group go in one line, Assets classified as held for sale. Liabilities go in another line, Liabilities directly associated with assets classified as held for sale. These two lines are shown separately from other assets and liabilities.

You must not offset the assets against the liabilities. They are two separate lines. Under Ind AS 1, the assets line is shown as a current asset, and the liabilities line is shown as a current liability. The assets of a disposal group are not split between current and non-current. The major classes of assets and liabilities of a disposal group are a required disclosure, either on the face or in the notes. This is in addition to the other note items below. It is not required if the disposal group is a newly acquired subsidiary that meets the held-for-sale criteria on acquisition.

The classification is applied from the date the criteria are met. Amounts for earlier periods are not reclassified or re-presented. Suppose a plant was held for use at the last year-end. The comparative balance sheet still shows it as PPE. Only the current period shows it as held for sale. This is a key difference from discontinued operations in the statement of profit and loss, where comparatives are re-presented.

The notes then tell the full story: what the asset is, why and how you expect to sell it, any impairment loss or gain recognised and the line item in the statement of profit and loss that includes it, the segment in which it sits, and, for a disposal group, the major classes of its assets and liabilities. If the plan to sell changes, extra disclosures are needed in the period of the decision.

Key rules to remember

Balance sheet presentation: Assets held for sale (one line) | Liabilities directly associated (one line) | No offsetting; Present separately from other assets and liabilities. Do not net the two lines against each other.
Comparatives rule: Prior-period balance sheet: not reclassified, not restated; Applies to balance sheet amounts for non-current assets or disposal groups classified as held for sale in the latest period.
Equity-linked amounts: Cumulative income or expense in OCI relating to the group: present separately; If any is recognised in OCI for assets held for sale, show it separately within equity.
Core note disclosures: Description + facts and circumstances (including expected manner and timing of disposal) + gain/loss and the statement of profit and loss caption that includes it + segment (if Ind AS 108 applies) + major classes of assets and liabilities (disposal group); Disclose in the period the asset is classified as held for sale or sold. The first four are the core note items to write every time. For a disposal group, also give the major classes of assets and liabilities, on the face or in the notes, except for a newly acquired subsidiary.
Change of plan: Plan to sell withdrawn: disclose facts and effect on results for the period and prior periods; Disclose in the period of the decision to change the plan.

How to solve Presentation and Disclosure Requirements questions

Use this method for any question on presentation or disclosure of held-for-sale items.

1Confirm the held-for-sale criteria are met at the reporting date. If not, the asset stays in its normal class.
2Identify whether the item is a single asset or a disposal group, and which liabilities are directly associated with it.
3Measure first, at the lower of carrying amount and fair value less costs to sell, and stop depreciation. Then present.
4Show assets in one line and liabilities in another. Do not offset them.
5Leave prior-period balance sheet figures unchanged. State that comparatives are not restated.
6Check for amounts recognised in OCI related to the group, and present them separately in equity.
7List the note disclosures: description, facts and circumstances, gain or loss, and segment. For a disposal group, add the major classes of assets and liabilities.
8Conclude with the extract of the balance sheet and the note wording.

Quickest way: Three-line check for presentation answers

When to use it: Use this when you have limited time and the question asks for the balance sheet extract or the disclosures.

Line 1: assets held for sale, at the lower of carrying amount and fair value less costs to sell.
Line 2: liabilities directly associated, shown separately and not netted.
Line 3: comparatives unchanged. Then add the note points: description, facts, gain or loss, segment, and, for a disposal group, the major classes of assets and liabilities.

Common mistakes in Presentation and Disclosure Requirements

Offsetting held-for-sale assets against the associated liabilities and showing a net figure.
Students think a disposal group is sold as a net amount.
Fix: Show two separate lines. The standard requires assets and liabilities to be presented separately from each other.
Restating the prior-year balance sheet to show the asset as held for sale.
Students mix this up with the re-presentation of discontinued operations in the statement of profit and loss.
Fix: Remember the split. Balance sheet comparatives are not restated. Profit and loss comparatives for discontinued operations are re-presented.
Continuing to charge depreciation on the asset after classification.
Students forget that the asset is no longer being used up through operations.
Fix: Stop depreciation from the date of classification, even if the asset is still in use.
Including liabilities that are not directly associated, such as general borrowings of the company.
Students include all liabilities of the segment.
Fix: Include only liabilities that will be transferred with the group in the disposal transaction.
Leaving out the note disclosures, such as the segment and the facts and circumstances of the sale.
Students focus only on the numbers.
Fix: Write the core note items every time: description, facts and circumstances, gain or loss, and segment. For a disposal group, add the major classes of assets and liabilities.
Splitting the held-for-sale assets into current and non-current on the balance sheet face.
Students apply the Ind AS 1 classification by habit.
Fix: Present the group's assets as a single separate line within current assets, without splitting them into current and non-current.

Worked examples

Example 1

Case: Meru Ltd (March year-end, Ind AS) decides to sell a division and meets all held-for-sale criteria on 28 February 2027. At 31 March 2027 the division has assets with a carrying amount of ₹8,00,000 and directly associated liabilities of ₹2,50,000. Fair value less costs to sell of the net disposal group (assets less liabilities) is ₹6,00,000. No impairment has been recognised so far. At 31 March 2026 the same assets were shown within PPE and current assets. How will Meru present the division in the balance sheet at 31 March 2027, and what happens to comparatives?

Show the solution

The disposal group is measured as a whole, on a net basis. Net carrying amount = ₹8,00,000 − ₹2,50,000 = ₹5,50,000.
The fair value less costs to sell of ₹6,00,000 is stated for the net disposal group (assets less the liabilities transferred with them). So compare like with like: net carrying amount ₹5,50,000 against ₹6,00,000.
The lower figure is ₹5,50,000, the carrying amount. The fair value less costs to sell is higher, so there is no impairment loss. Because no impairment was recognised earlier, there is also no gain to recognise. The group is not written up above its carrying amount.
Present the assets gross at ₹8,00,000 in one line: Assets classified as held for sale, shown as a current asset.
Present the liabilities gross at ₹2,50,000 in another line: Liabilities directly associated with assets classified as held for sale, shown as a current liability. Do not net them to ₹5,50,000.
Comparatives at 31 March 2026 are not restated. The assets stay in PPE and current assets as originally reported.
Stop depreciation from 28 February 2027.

Answer: The net disposal group has a carrying amount of ₹5,50,000 against a fair value less costs to sell of ₹6,00,000, so there is no impairment. At 31 March 2027, show assets held for sale of ₹8,00,000 and directly associated liabilities of ₹2,50,000 as separate lines, not netted. The 31 March 2026 balance sheet is not restated.

Example 2

Case: Kaveri Ltd classifies a plant as held for sale in the year ended 31 March 2027 after the board approves a sale. The plant belongs to the Manufacturing segment. Its carrying amount before classification was ₹12,00,000 and fair value less costs to sell is ₹10,50,000. The plant has no related liabilities. What will Kaveri show in the balance sheet and disclose in the notes?

Show the solution

Measure at the lower of carrying amount ₹12,00,000 and fair value less costs to sell ₹10,50,000. This gives ₹10,50,000.
Impairment loss = ₹12,00,000 − ₹10,50,000 = ₹1,50,000. Recognise it in profit or loss.
Present ₹10,50,000 as Assets classified as held for sale, separate from other assets. There is no liabilities line since none are associated.
Do not restate the prior-year balance sheet. The plant remains in PPE for the comparative period.
Note disclosures: (1) a description of the plant; (2) the facts and circumstances of the sale, including the expected manner and timing of disposal; (3) the impairment loss of ₹1,50,000 and the caption in the statement of profit and loss that includes it; (4) the Manufacturing segment in which the plant is presented. This is a single asset, not a disposal group, so there are no major classes of assets and liabilities to show.

Answer: Show the plant at ₹10,50,000 as a separate line under assets held for sale, after an impairment loss of ₹1,50,000. Comparatives are not restated. Give the note disclosures: description, facts and circumstances (with expected manner and timing), the loss and its profit and loss caption, and the segment.

Exam tips

Write the comparatives point explicitly. Examiners often ask whether prior periods are restated, and the short answer is no for the balance sheet.
Draw the two-line balance sheet extract in your answer. It earns marks faster than a paragraph.
Do the measurement first in numerical questions. Presentation marks depend on the right carrying amount.
In MCQs, watch for options that offset assets and liabilities, or that restate comparatives. Both are wrong.
Close theory answers with the note disclosures as a short list: the four core items, plus the major classes of assets and liabilities for a disposal group.

Practice questions from Ind AS 105 Non-current Assets Held for Sale and Discontinued Operations

Presentation and Disclosure Requirements in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Presentation and Disclosure Requirements: frequently asked questions

Are comparatives restated for held for sale under Ind AS 105?

No. Balance sheet amounts for prior periods are not reclassified or re-presented when an asset is classified as held for sale in the current period. The comparative shows the asset in its original category.

Can I offset held-for-sale assets against the related liabilities?

No. Assets and liabilities of a disposal group are presented as separate lines. Netting them hides information that users need.

Do held-for-sale assets go under current assets?

Yes. Under Ind AS 1, the assets classified as held for sale line is shown as a current asset, and the line for liabilities directly associated with them is shown as a current liability. You do not split a disposal group's assets into current and non-current on the face of the balance sheet.

What must be disclosed in the notes for held-for-sale items?

Disclose a description of the asset or group, the facts and circumstances of the sale and its expected manner and timing, any gain or loss recognised and the caption in the statement of profit and loss that includes it, and the reportable segment where Ind AS 108 applies. For a disposal group, also disclose the major classes of assets and liabilities, on the face or in the notes, unless it is a newly acquired subsidiary.