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CMA Final · Corporate Financial Reporting · Revenue from Contracts with Customers (Ind AS 115)

Sundaram Textiles Ltd recognised revenue from contracts with customers of Rs 250 lakh. During the year it recognised impairment losses under Ind AS 109 of Rs 4 lakh on receivables arising from these contracts and Rs 3 lakh on contract assets from these contracts, and Rs 2 lakh on a loan given to a supplier (not a customer contract). Impairment losses are not separately shown in the statement of profit and loss. What amount of impairment loss must be disclosed separately as relating to contracts with customers?

Rs 7 lakh must be disclosed, being Rs 4 lakh on receivables plus Rs 3 lakh on contract assets arising from customer contracts. The Rs 2 lakh loan impairment relates to a supplier, not a customer contract, so it is disclosed separately and excluded.

  1. ARs 9 lakh
  2. BRs 7 lakhCorrect
  3. CRs 4 lakh
  4. DRs 5 lakh

Explanation

Paragraph 113(b) requires disclosure of impairment losses on receivables or contract assets arising from contracts with customers, separately from impairment on other contracts. Rs 4 lakh + Rs 3 lakh = Rs 7 lakh. The Rs 2 lakh loan to a supplier is not from a customer contract, so including it gives Rs 9 lakh, which is wrong.

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