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CA Final · Financial Reporting · Ind AS 36 Impairment of Assets

Sagar Infra Ltd prepares its financial statements under Ind AS. The company's accounting team notes that Ind AS 36 contains certain paragraph numbers that appear as 'Deleted' in IAS 36, and that paragraphs 25-27 of IAS 36 on fair value are missing from Ind AS 36. What is the reason for the missing paragraphs 25-27 in Ind AS 36?

Paragraphs 25-27 of Ind AS 36 are deleted as a consequence of Ind AS 113, Fair Value Measurement, which now governs fair value measurement. The paragraph numbers are retained so that numbering stays consistent with IAS 36.

  1. AThey were deleted as a consequence of Ind AS 113, Fair Value Measurement, with the numbering retained to match IAS 36Correct
  2. BThey were deleted because Ind AS 36 does not permit use of fair value less costs of disposal
  3. CThey were moved to Ind AS 101 as transitional provisions
  4. DThey were deleted because investment property is measured at fair value under Ind AS 40

Explanation

The comparison with IAS 36 states that paragraphs 25-27 (and 5(b)) were deleted as a consequence of Ind AS 113. Numbering is retained for consistency with IAS 36. Fair value less costs of disposal is still a valid basis for recoverable amount, so option 1 is wrong. Ind AS 40 requires the cost model, so option 3 is wrong.

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