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

Ganga Pharma Ltd sells goods on credit to hospitals. For the year, it recognised revenue of Rs 50 crore from contracts with customers. It also recognised Rs 1.2 crore of impairment loss under Ind AS 109 on receivables arising from these customer contracts, and Rs 0.3 crore of impairment loss on a loan given to a group company. Neither amount is separately presented in the statement of profit and loss under another Standard. What must Ganga Pharma disclose under Ind AS 115 about impairment?

Ganga Pharma must disclose the Rs 1.2 crore impairment on receivables from customer contracts separately from the Rs 0.3 crore impairment on the group company loan. Ind AS 115 requires impairment losses on customer contract receivables and contract assets to be shown separately from impairment losses on other contracts.

  1. ARs 1.5 crore as a single combined impairment loss on all receivables
  2. BRs 1.2 crore separately from the Rs 0.3 crore impairment loss on the other contractCorrect
  3. COnly Rs 0.3 crore, since customer receivable impairment is covered by Ind AS 109 alone
  4. DRs 1.2 crore netted against the Rs 50 crore revenue and not disclosed separately

Explanation

Paragraph 113(b) requires disclosure of impairment losses recognised under Ind AS 109 on receivables or contract assets from customer contracts, separately from impairment losses on other contracts. So Rs 1.2 crore is disclosed separately from the Rs 0.3 crore group loan impairment. Combining them to Rs 1.5 crore violates the separate disclosure requirement.

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