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CA Final · Financial Reporting · Ind AS 27 Separate Financial Statements

Tarang Capital Ltd is a parent that, under Ind AS 110, is required to measure its investment in a subsidiary, Delta Ventures Ltd, at fair value through profit or loss because Tarang is an investment entity. How must Tarang account for Delta in its separate financial statements?

Tarang must carry the investment in Delta at fair value through profit or loss in its separate financial statements too. When Ind AS 110 requires FVTPL measurement of a subsidiary, Ind AS 27 requires the same accounting in the SFS.

  1. AAt cost, as SFS permit a free choice
  2. BBy the equity method
  3. CIn the same way, at fair value through profit or loss under Ind AS 109Correct
  4. DAt fair value through OCI

Explanation

If a parent must measure a subsidiary at FVTPL per Ind AS 110, it must account for that investment in the same way in its SFS. Cost is therefore not available for it.

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