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CA Final · Financial Reporting · Ind AS 111 Joint Arrangements

Ind AS 111 differs from IFRS 11 in a paragraph on acquiring an interest in a joint operation. Ravi Group Ltd and Sita Group Ltd, both ultimately controlled by the same promoter before and after the acquisition (and the control is not transitory), acquire interests in a joint operation that is a business. Which accounting does Ind AS 111 specify for this acquisition?

Ind AS 111 requires the accounting in Appendix C, Business Combinations under Common Control, of Ind AS 103. This applies when all parties sharing joint control are under the same ultimate controlling party before and after, and that control is not transitory.

  1. AThe accounting in Appendix C, Business Combinations under Common Control, of Ind AS 103Correct
  2. BThe accounting under IFRS 3 without any modification
  3. CThe accounting under Ind AS 109 as a financial asset
  4. DThe equity method under Ind AS 28

Explanation

Paragraph B33D of Ind AS 111 refers to Appendix C of Ind AS 103 for acquiring an interest in a joint operation when the parties sharing joint control, including the acquirer, are under common control of the same ultimate controlling party both before and after, and the control is not transitory. IFRS 11 excludes this because IFRS 3 does not deal with common control combinations. Equity method and Ind AS 109 do not apply.

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