Financial Reporting · Ind AS 110 Consolidation Procedure for Subsidiaries

Ind AS 110 Differences from IFRS 10 Explained

Updated 5 October 2026

Ind AS 110 follows IFRS 10 on the control model. Appendix 1 lists wording changes and substantive departures. The key departure: Ind AS 110 has no investment entity exception, so an investment entity parent consolidates its subsidiaries. To answer, state the IFRS 10 position, the Ind AS 110 position, and the effect.

Understand Ind AS 110 Differences from IFRS 10

Ind AS 110 is the Indian version of IFRS 10. The control model rests on the same three elements: power, exposure to variable returns, and the link between them. Consolidation procedures follow the same lines. Each Ind AS carries an Appendix that compares it with the matching IFRS and says where India departed from it.

Appendix 1 of Ind AS 110 lists two kinds of difference:

Wording changes. Ind AS uses its own terms, such as balance sheet and statement of profit and loss. It points to Ind AS 109, Ind AS 28 and Ind AS 103 where IFRS 10 points to IFRS 9, IAS 28 and IFRS 3. Transition wording also differs, because Indian companies adopted Ind AS in phases.
Substantive departures. These change the accounting or the options available. The most important one for exams is the investment entity point below. Read Appendix 1 in the current notified text and note each substantive departure it records.

IFRS 10 has an investment entity exception (its paragraphs 27-33): an investment entity measures its subsidiaries at fair value through profit or loss under IFRS 9 and does not consolidate them. Ind AS 110 as notified departs from this. It does not include the exception, so a parent that is an investment entity consolidates its subsidiaries like any other parent. Confirm this against Appendix 1 in the current text and use its wording in your answer.

Do not treat the Appendix as drafting changes only. The marks come from stating each listed difference precisely, saying which standard it affects, and giving the effect on the accounting. Do not invent differences that the Appendix does not list.

The exemption from preparing consolidated statements has the same broad shape in both standards. The point to remember is the last condition. Ind AS 110 paragraph 4(a)(iv) refers to the ultimate or any intermediate parent producing consolidated financial statements for public use that comply with Ind AS, where IFRS 10 refers to IFRS. In outline, a parent need not present consolidated statements if all of these hold:

It is a wholly owned subsidiary, or a partially owned subsidiary whose other owners, including those not otherwise entitled to vote, have been informed about the parent not presenting consolidated statements and do not object.
Its debt or equity instruments are not traded in a public market.
It has not filed, and is not in the process of filing, its financial statements with a securities commission or regulator to issue any class of instruments in a public market.
Its ultimate or any intermediate parent produces consolidated financial statements available for public use that comply with Ind AS. IFRS 10 refers to IFRS here, so on this wording statements that comply only with IFRS would not meet the Ind AS 110 condition. Check the wording of paragraph 4(a)(iv) in the current text before you write it.

The exact list in Appendix 1 can change with amendments. Read the Appendix in the current text of the standard and keep your own short list. This page gives you the structure to organise that list and answer from it.

Key rules to remember

Answer structure for a difference: IFRS 10 position → Ind AS 110 position → reason or effect; Use this three-part line for every difference. It earns marks even when a question asks only for a 'brief' comparison.
Core principle: Ind AS 110 follows IFRS 10 on the control model; Appendix 1 lists terminology and cross-reference changes and any substantive departures; Do not claim India has a different control model, and do not claim the differences are only wording. Learn the listed differences from the current Appendix.
Exemption from consolidation (parent): Exempt only if all conditions are met: wholly owned, or other owners (including those not otherwise entitled to vote) informed and not objecting; securities not publicly traded; no filing for a public issue; ultimate or intermediate parent publishes public consolidated statements that comply with Ind AS (paragraph 4(a)(iv); IFRS 10 says IFRS); The structure matches IFRS 10, but the last condition refers to compliance with Ind AS, not IFRS. On that wording, public statements under IFRS alone do not meet it. All conditions must be met. Check the current text of the paragraph.
Investment entity subsidiaries: IFRS 10: an investment entity measures subsidiaries at fair value through profit or loss and does not consolidate them. Ind AS 110 as notified: no investment entity exception, so the parent consolidates its subsidiaries; This is a substantive departure from IFRS 10. Confirm it against Appendix 1 in the current text. Do not write that India retained the exception.

How to solve Ind AS 110 Differences from IFRS 10 questions

Use this method for any question that asks you to compare Ind AS 110 with IFRS 10 or to apply a difference to a case.

1Identify the exact issue in the case: exemption from consolidation, investment entity, terminology, cross-reference, or transition.
2Write the IFRS 10 position in one line, using IFRS terms.
3Write the Ind AS 110 position in one line, using Ind AS terms and the Ind AS cross-references.
4State whether the point changes the accounting or only the wording or reference. Say so clearly. Do not assume a listed difference is only wording.
5Apply it to the facts: conclude whether the entity consolidates or follows the Ind AS route. For an exemption, tick each condition against the facts.
6Close with a one-line conclusion that answers the question asked.

Quickest way: Three-column memory sweep

When to use it: When the question says 'state the differences' and you have about five minutes.

List three headings: terminology, cross-references to other standards, and substantive departures listed in Appendix 1 (with transition wording noted alongside).
Under each heading, write one IFRS 10 phrase against its Ind AS 110 equivalent.
Under substantive departures, write the points from your own list of the current Appendix. Include the investment entity point: IFRS 10 has the exception, Ind AS 110 as notified does not, so the parent consolidates.
Write one closing sentence: the control model is the same, but Appendix 1 records real departures as well as wording changes.

Common mistakes in Ind AS 110 Differences from IFRS 10

Inventing a difference that Appendix 1 does not list, such as a different control definition.
The word 'carve-out' suggests a major departure, so students guess one.
Fix: State that control rests on power, exposure to variable returns and the link between them. Quote only differences you have checked in the current Appendix.
Saying the differences in Appendix 1 are only terminology and references.
Students notice the wording changes first and assume that is all.
Fix: Add the substantive departures you have checked in the current Appendix 1, and state their effect on the accounting.
Writing IFRS terms such as 'statement of financial position' in an Ind AS answer.
Students study IFRS textbooks or international material alongside the Indian material.
Fix: Use balance sheet and statement of profit and loss in every Ind AS answer.
Treating an IFRS-compliant public statement of the intermediate or ultimate parent as enough for the exemption, or checking only that condition.
Students remember the IFRS 10 wording and apply it unchanged, or stop at one condition.
Fix: Remember that paragraph 4(a)(iv) refers to public statements that comply with Ind AS, so check the current wording and do not accept IFRS-only statements without comment. Also check that every other condition is met: the ownership and other-owners condition, no public trading, and no filing for a public issue.
Naming IFRS 9, IFRS 3 or IAS 28 in an answer about Ind AS 110.
Students copy the IFRS 10 text from memory.
Fix: Convert each reference: Ind AS 109, Ind AS 103 and Ind AS 28.
Writing that Ind AS 110 keeps the investment entity exception, so an investment entity parent measures its subsidiaries at fair value and does not consolidate them.
Students remember paragraphs 27-33 of IFRS 10 and assume India adopted them unchanged.
Fix: Remember that Ind AS 110 as notified does not include the exception. An investment entity parent consolidates its subsidiaries. Confirm the wording in Appendix 1 of the current text.

Worked examples

Example 1

Case: Alpha Ltd, an Indian company, is a wholly owned subsidiary of Beta Pte Ltd, Singapore. Beta publishes consolidated financial statements for public use under IFRS. No Alpha securities are publicly traded, and Alpha has not filed for a public issue. Alpha has its own subsidiaries and asks whether it can skip preparing consolidated statements under Ind AS 110. Advise.

Show the solution

Issue: Whether the parent exemption from consolidation applies.
Rule: A parent need not present consolidated statements if all conditions are met. It must be a wholly owned subsidiary, or a partially owned one whose other owners, including those not otherwise entitled to vote, have been informed and do not object. Its securities must not be publicly traded. It must not have filed for a public issue. Its ultimate or an intermediate parent must produce public consolidated statements that comply with Ind AS, as paragraph 4(a)(iv) is worded. IFRS 10 says IFRS here.
Application: Alpha is wholly owned, so the other-owners condition does not arise. Its securities are not traded and it has not filed for a public issue, so those conditions are met.
Last condition: Beta's public statements comply with IFRS, not Ind AS. On the wording of paragraph 4(a)(iv), which refers to Ind AS, this condition is not met on these facts. Confirm the wording in the current text of the standard.

Answer: On the wording of paragraph 4(a)(iv), Alpha cannot use the exemption, because Beta's public consolidated statements are under IFRS, not Ind AS. Alpha must therefore prepare consolidated financial statements under Ind AS 110. The exemption would be available only if an ultimate or intermediate parent published Ind AS-compliant consolidated statements for public use and the other conditions stayed met.

Example 2

Case: Gamma Fund Ltd meets the definition of an investment entity and holds a 70% stake in Delta Ltd, an operating company that provides no services related to Gamma's investment activities. A student says that under Ind AS 110 Gamma must consolidate Delta because Indian rules differ from IFRS 10. Evaluate.

Show the solution

Issue: Whether Ind AS 110 requires an investment entity to consolidate a subsidiary such as Delta.
IFRS 10 position: An investment entity does not consolidate its subsidiaries. It measures them at fair value through profit or loss under IFRS 9.
Ind AS 110 position: As notified, Ind AS 110 does not include the investment entity exception. An investment entity parent consolidates its subsidiaries like any other parent. Confirm this against Appendix 1 in the current text.
Effect: The accounting differs from IFRS 10. Gamma controls Delta through its 70% stake, so Delta is a subsidiary and is consolidated.
Application: Gamma consolidates Delta line by line and shows a 30% non-controlling interest in Delta's net assets and profit. It does not carry Delta at fair value through profit or loss.

Answer: The student is right. Gamma must consolidate Delta, because Ind AS 110 as notified has no investment entity exception. This is a departure from IFRS 10, and the 30% not held by Gamma is shown as non-controlling interest.

Exam tips

Write 'Ind AS 110 follows the control model of IFRS 10' early in a comparison answer, then say that Appendix 1 lists further differences.
Convert every cross-reference and every term to Ind AS wording. Examiners notice this.
For case questions on exemption, list all the conditions and tick each against the facts. Do not rely on one condition.
Read Appendix 1 of Ind AS 110 in the current notified text before the exam and make a short personal list, including the investment entity point, because amendments can change it.

Practice questions from Ind AS 110 Consolidation Procedure for Subsidiaries

Ind AS 110 Differences from IFRS 10: frequently asked questions

Is Ind AS 110 the same as IFRS 10?

The control model is the same: power, exposure to variable returns and the link between them. But Appendix 1 lists differences in terminology and cross-references, and records substantive departures such as the treatment of investment entities. Read the current Appendix and note what it lists.

Why does Ind AS 110 have a comparison with IFRS 10 in an appendix?

Ind AS are converged with IFRS but not identical. Each standard includes an appendix that shows where the Indian text departs from the IFRS text, so users can see the gap.

Does Ind AS 110 have the investment entity exception?

No. IFRS 10 lets an investment entity measure its subsidiaries at fair value through profit or loss instead of consolidating them. Ind AS 110 as notified does not include this exception, so an investment entity parent consolidates its subsidiaries. Confirm the wording in Appendix 1 of the current text.

How should I learn the differences for the exam?

Read Appendix 1 once in the current notified text. Group the points under terminology, cross-references and substantive departures. Revise each using the IFRS 10 position, Ind AS 110 position and effect. Remember that the investment entity exception is not part of Ind AS 110.