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CA Final · Financial Reporting · Ind AS 1 Presentation of Financial Statements

Kaveri Engineering Ltd, reporting under Ind AS, titles its primary statements 'Statement of Financial Position' and 'Statement of Profit or Loss and Other Comprehensive Income', copying its foreign parent's format. Which view is consistent with Ind AS 1 as notified in India?

The entity should use 'Balance Sheet' and 'Statement of Profit and Loss'. Ind AS 1 removed the IAS 1 option of using different titles and prescribes a single terminology for all entities, so copying the foreign parent's titles is not acceptable in India.

  1. AThe titles are acceptable because entities may choose their own terminology
  2. BThe titles should be 'Balance Sheet' and 'Statement of Profit and Loss', since Ind AS 1 removed alternatives and prescribes one terminology for all entitiesCorrect
  3. COnly the balance sheet title may be changed, the profit statement title must be the IAS 1 title
  4. DThe IAS 1 titles are mandatory for entities with foreign parents

Explanation

The comparison with IAS 1 notes that IAS 1 lets entities use other titles, but Ind AS 1 removes the alternatives and gives one terminology to all entities: 'balance sheet' and 'Statement of Profit and Loss'. Choosing the parent's titles is therefore not consistent with Ind AS 1.

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