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

Sundaram Textiles Ltd is an Ind AS reporting entity. Its finance head proposes to present a separate 'Statement of Profit or Loss' followed by a second statement beginning with profit and showing other comprehensive income, as IAS 1 permits. Under Ind AS 1 as notified in India, which statement is correct?

Ind AS 1 permits only the single statement approach. The Statement of Profit and Loss must present profit or loss and other comprehensive income together, because the Indian standard removed the IAS 1 option of a separate second statement. A choice between approaches is not available in India.

  1. AInd AS 1 allows only the single statement approach, so the Statement of Profit and Loss must include other comprehensive incomeCorrect
  2. BInd AS 1 allows the entity to choose between the single statement and two statement approaches
  3. CInd AS 1 requires the two statement approach for listed entities and the single statement for others
  4. DInd AS 1 requires other comprehensive income to be shown only in the notes

Explanation

The comparison with IAS 1 in Appendix 1 states that IAS 1 gives an option between the single statement and two statement approaches, but Ind AS 1 allows only the single statement approach. The entity's proposal therefore cannot be followed. The option permitting a choice reflects IAS 1, not Ind AS 1.

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