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CA Final · Financial Reporting · Ind AS 21 The Effects of Changes in Foreign Exchange Rates

Gamma Ltd's CFO asks where the transitional provisions for first-time adopters on foreign exchange translation are found, since Ind AS 21 contains none. What is the correct position?

Transitional provisions are not in Ind AS 21. They are placed in Ind AS 101, First-time Adoption of Indian Accounting Standards, which corresponds to IFRS 1. Paragraphs 58-60J are not included in Ind AS 21, and their numbers are kept only for consistency with IAS 21.

  1. AThey are included in Ind AS 101, which corresponds to IFRS 1, so Ind AS 21 omits themCorrect
  2. BThey are in Ind AS 21 paragraphs 58-60J
  3. CThey are in Ind AS 8, which governs all transitions
  4. DThey are not available anywhere and the entity must apply Ind AS 21 retrospectively

Explanation

Ind AS 21 omits IAS 21's transitional provisions because all Ind AS transitional provisions are placed in Ind AS 101. Paragraphs 58-60J are retained as numbers only and carry no content on effective date and transition, so that option is wrong.

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