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CA Final · Financial Reporting · Financial Instruments: Disclosures

Orion Steels Ltd's consultant claims that Ind AS 107 requires a separate income statement description of gains and losses on financial instruments, as IFRS 7 does where an entity presents a separate income statement. Which response is correct as per Ind AS 107's comparison with IFRS 7?

The consultant is incorrect. The requirement concerning a separate income statement was deleted in Ind AS 107 as a consequence of Ind AS 1 removing the two-statement option, and Ind AS 1 requires components of profit or loss and other comprehensive income to be presented within the statement of profit and loss.

  1. ACorrect; Ind AS 1 allows a two-statement approach so the requirement is retained
  2. BIncorrect; the requirement was deleted because Ind AS 1 removed the two-statement option and requires profit or loss and OCI components in one statement of profit and lossCorrect
  3. CIncorrect; the requirement was deleted because gains and losses on financial instruments need no disclosure
  4. DCorrect; but only for entities that have listed securities

Explanation

The comparison says requirements for describing gains and losses in a separate income statement were deleted as a consequence of removing the two-statement option; Ind AS 1 requires components of profit or loss and OCI in the statement of profit and loss. Option 3 overstates the deletion.

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