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CA Final · Financial Reporting · Ind AS 23 Borrowing Costs

A finance manager at Godavari Foods Ltd is comparing Ind AS 23 with IAS 23, particularly for foreign currency borrowings. Which statement correctly describes a difference noted in the comparison with IAS 23?

Ind AS 23 adds paragraph 6A to guide how the adjustment under paragraph 6(e) is determined, because IAS 23 provides no guidance on this. The other statements are wrong: paragraphs 6(b) and 6(c) are deleted, and the transitional and effective date paragraphs are not included in Ind AS 23.

  1. AInd AS 23 includes the transitional provisions in paragraphs 27-28 of IAS 23
  2. BInd AS 23 adds paragraph 6A to give guidance on determining the adjustment referred to in paragraph 6(e), on which IAS 23 gives no guidanceCorrect
  3. CInd AS 23 retains paragraphs 6(b) and 6(c) with full operative text
  4. DInd AS 23 includes the effective date paragraphs 29-29B of IAS 23

Explanation

IAS 23 gives no guidance on how the paragraph 6(e) adjustment is to be determined, so Ind AS 23 adds paragraph 6A. Paragraphs 6(b) and 6(c) appear as deleted, with their numbers retained. Transitional provisions are moved to Ind AS 101, and the effective date paragraphs are not included as they are not relevant in India.

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