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CA Final · Financial Reporting · Ind AS 115 Revenue from Contracts with Customers

Bharat Spirits Ltd sells goods subject to excise duty and presents revenue in its statement of profit and loss. Revenue recognised for the year includes excise duty of Rs 12 crore. Which statement reflects the Ind AS 115 requirement as notified in India?

Bharat Spirits must present the Rs 12 crore of excise duty included in its revenue separately in the statement of profit and loss. This is an Indian-specific addition in Ind AS 115 compared with IFRS 15, so silently netting or omitting the duty is not allowed.

  1. AExcise duty must be deducted from revenue and not mentioned anywhere
  2. BExcise duty is ignored, since it is a government levy unrelated to revenue
  3. CThe Rs 12 crore excise duty included in revenue must be presented separately in the statement of profit and lossCorrect
  4. DExcise duty may be disclosed only in the auditor's report

Explanation

Ind AS 115 as notified in India adds a requirement, absent from IFRS 15, to present separately the amount of excise duty included in revenue recognised in the statement of profit and loss. Hence the Rs 12 crore is shown separately. Netting it off silently or omitting it does not meet this carve-out.

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