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CMA Final · Corporate Financial Reporting · Property, Plant and Equipment (Ind AS 16)

Under the Ind AS 16 treatment of the amendment on items sold during testing, which statement is correct for Ind AS 16 as notified in India?

The IASB's 2020 amendment prohibiting deduction of sale proceeds from cost has not been made in Ind AS 16. Instead, paragraph 17(e) was amended so the excess of net proceeds over testing cost is deducted from the asset's directly attributable costs.

  1. AThe IAS 16 amendment prohibiting deduction of sale proceeds from cost has not been made in Ind AS 16Correct
  2. BThe IAS 16 amendment on proceeds before intended use has been adopted without change
  3. CInd AS 16 requires all sale proceeds during testing to be shown as revenue
  4. DInd AS 16 prohibits any testing cost from being capitalised

Explanation

The comparison with IAS 16 states the May 2020 IASB amendments on proceeds before intended use have not been made under Ind AS 16. Instead paragraph 17(e) was amended so the excess of net proceeds over testing cost is deducted from directly attributable costs. Hence the other options misstate this.

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