Skip to content

CMA Final · Corporate Financial Reporting · Revenue from Contracts with Customers (Ind AS 115)

Hind Steels Ltd sold goods during the year and its revenue in the statement of profit and loss includes Rs 40 lakh of excise duty. Which presentation requirement does Ind AS 115 add to IFRS 15 in this regard?

Ind AS 115 includes paragraph 109AA, which requires an entity to present separately the amount of excise duty included in the revenue recognised in the statement of profit and loss. Hind Steels must therefore show the Rs 40 lakh separately.

  1. AThe excise duty must be deducted from revenue and not disclosed anywhere
  2. BThe excise duty must be disclosed only in the notes on contingent liabilities
  3. CExcise duty is presented separately as an expense with no reference to revenue
  4. DThe amount of excise duty included in revenue recognised in the statement of profit and loss must be presented separatelyCorrect

Explanation

Paragraph 109AA was inserted in Ind AS 115 to require separate presentation of the excise duty amount included in revenue recognised in the statement of profit and loss. So Rs 40 lakh must be shown separately. Deducting it silently or hiding it in a contingent liability note does not comply.

Did you get it right without looking?

One question tells you little. A timed set on Revenue from Contracts with Customers (Ind AS 115) shows your real accuracy, how long you take and where you lose marks.

Practise Revenue from Contracts with Customers (Ind AS 115)Free diagnostic mock

More Revenue from Contracts with Customers (Ind AS 115) questions