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CA Final · Financial Reporting · Financial Instruments: Disclosures

Kaveri Power Ltd presents its results under Ind AS 1 and reports components of profit or loss and other comprehensive income in one statement. Its analyst asks why Ind AS 107 omits the IFRS 7 requirement to describe gains and losses presented in a separate income statement. Which explanation matches the Ind AS 107 comparison with IFRS 7?

The requirement was deleted as a consequence of Ind AS 1 removing the two-statement option present in IAS 1. Ind AS 1 requires components of profit or loss and other comprehensive income to be presented in the single statement of profit and loss, so a separate income statement description is unnecessary.

  1. AThe requirement was deleted because separate income statements are prohibited for financial instruments only
  2. BThe deletion is consequential to Ind AS 1 removing the two-statement approach, so components of profit or loss and OCI are presented in the statement of profit and lossCorrect
  3. CThe deletion arises because gains and losses on financial instruments need not be disclosed under Ind AS
  4. DThe deletion arises because the requirement was moved to Ind AS 101

Explanation

The comparison says the requirement regarding a separate income statement was deleted as a consequence of removing the two-statement option available in IAS 1. Ind AS 1 requires components of profit or loss and OCI to be presented as part of the statement of profit and loss. Option C is wrong because gains and losses are still disclosed.

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