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CA Final · Financial Reporting · Ind AS 103 Business Combinations

A reviewer compares Ind AS 103 with IFRS 3 for a case on a bargain purchase in Ind AS financial statements of Sahyadri Infra Ltd. Which statement about the differences between the two, as described in the Ind AS 103 comparison appendix, is correct?

The correct statement is that Ind AS 103 gives common control guidance in Appendix C, while IFRS 3 excludes such combinations from its scope. Transitional provisions sit in Ind AS 101, bargain gains go to OCI or equity, and IFRS paragraph numbers are retained.

  1. AInd AS 103 adds guidance on business combinations of entities under common control in Appendix C, whereas IFRS 3 excludes them from its scopeCorrect
  2. BInd AS 103 includes the IFRS 3 transitional provisions in full, while Ind AS 101 is silent on them
  3. CInd AS 103 requires bargain purchase gain in profit or loss, whereas IFRS 3 requires it in OCI
  4. DInd AS 103 deletes paragraph numbers of IFRS 3 and renumbers the remaining paragraphs consecutively

Explanation

IFRS 3 excludes combinations of entities under common control from scope, while Ind AS 103 gives guidance in Appendix C, so paragraph 2 was modified and 2B added. The transitional provisions are not in Ind AS 103 but in Ind AS 101. The bargain purchase treatment is the reverse of option three. Paragraph numbers are retained, not renumbered, so the fourth option is wrong.

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