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CA Intermediate · Advanced Accounting · AS 24 Discontinuing Operations

Ganga Foods Ltd. has a discontinuing operation. In its financial statements for the year ended 31 March 2027, which presentation is required by AS 24 regarding comparatives for the prior period?

AS 24 requires the disclosures about the discontinuing operation to be re-presented for comparative prior periods, so that the continuing and discontinuing parts are shown separately for those periods as well. The main statement totals are not retrospectively altered by this requirement.

  1. APrior period information need not be restated in any way
  2. BComparative information for prior periods that relate to the discontinuing operation must be re-presented in disclosures separating continuing and discontinuing operationsCorrect
  3. CPrior period figures are to be adjusted retrospectively in the main profit and loss statement to exclude the operation
  4. DOnly the net assets figure of the prior year is to be shown

Explanation

AS 24 requires that disclosures for prior periods presented in financial statements be re-presented so that the disclosures relating to discontinuing operations are shown for those periods as well, separating them from continuing operations. It does not require changing the primary statement totals retrospectively.

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