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

Mahati Engineering Ltd. reports under Ind AS. Its draft statements use the terms 'statement of financial position' and 'statement of comprehensive income', with revenue from customer contracts of ₹12 crore and excise duty of ₹1 crore included within it. Which change is consistent with Ind AS 115 as notified in India?

Mahati Engineering should adopt Indian terminology, using 'balance sheet' and 'statement of profit and loss', and should present separately the ₹1 crore of excise duty included in revenue. Ind AS 115 adds this excise duty presentation requirement beyond IFRS 15, so omitting or netting it would be non-compliant.

  1. AUse 'balance sheet' and 'statement of profit and loss', and present the ₹1 crore excise duty included in revenue separatelyCorrect
  2. BKeep the IFRS terms and omit excise duty disclosure since IFRS 15 does not require it
  3. CUse 'balance sheet' but net the excise duty off revenue without disclosure
  4. DUse 'statement of profit and loss' but disclose excise duty only in the directors' report

Explanation

Ind AS 115 uses 'balance sheet' instead of 'statement of financial position' and 'statement of profit and loss' instead of 'statement of comprehensive income'. It also requires separate presentation of excise duty included in revenue in the statement of profit and loss. Only the first option satisfies both points.

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