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CMA Intermediate · Corporate Accounting and Auditing · Inventories (Ind AS 2)

Under Ind AS 2, costs incurred to fulfil a contract with a customer that do not give rise to inventories (or assets within the scope of another Standard) are accounted for under which Standard?

They are accounted for under Ind AS 115, Revenue from Contracts with Customers. Ind AS 2 says contract fulfilment costs that do not create inventories or assets within another Standard fall under Ind AS 115.

  1. AInd AS 16, Property, Plant and Equipment
  2. BInd AS 115, Revenue from Contracts with CustomersCorrect
  3. CInd AS 37, Provisions, Contingent Liabilities and Contingent Assets
  4. DInd AS 38, Intangible Assets

Explanation

Ind AS 2 states that such contract fulfilment costs not giving rise to inventories or assets under another Standard are accounted for in accordance with Ind AS 115. The other Standards are not referred to for this purpose.

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