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CA Final · Financial Reporting · Introduction to Indian Accounting Standards

Ganga Foods Ltd, a listed company, has a wholly owned subsidiary Yamuna Retail Pvt Ltd. Ganga Foods prepares standalone and consolidated financial statements. Which statement is correct?

Both standalone and consolidated financial statements of Ganga Foods must be prepared under Ind AS. Once a company is covered by the Ind AS roadmap, the requirement applies to all of its financial statements, so it cannot use Accounting Standards for the standalone set.

  1. AOnly consolidated statements need follow Ind AS; standalone statements may follow AS
  2. BBoth standalone and consolidated financial statements of Ganga Foods must follow Ind ASCorrect
  3. COnly standalone statements need follow Ind AS since the parent is listed
  4. DConsolidated statements follow Ind AS, and standalone statements follow whichever framework the auditor recommends

Explanation

Where a company is covered by the Ind AS roadmap, the requirement applies to both its standalone and its consolidated financial statements. There is no option to apply AS to standalone statements while using Ind AS for consolidation. Option A is therefore incorrect.

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