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CA Final · Financial Reporting · Ind AS 115 Revenue from Contracts with Customers

Which statement correctly describes how Ind AS 115 differs from IFRS 15 regarding penalties?

Ind AS 115 amends paragraph 51 so that penalties are no longer listed among the examples of why consideration can vary, and it inserts paragraph 51AA to explain how penalties are accounted for. This is a difference from IFRS 15.

  1. APenalties continue to be listed in paragraph 51 of Ind AS 115 as an example of variable consideration, same as IFRS 15
  2. BInd AS 115 has no paragraph dealing with penalties
  3. CParagraph 51 of Ind AS 115 excludes penalties from its list of examples of why consideration varies, and paragraph 51AA is inserted to explain the accounting for penaltiesCorrect
  4. DInd AS 115 removes paragraph 51 entirely and replaces it with paragraph 51AA

Explanation

IFRS 15 paragraph 51 lists penalties among reasons consideration can vary. Ind AS 115 amended paragraph 51 to exclude penalties from that list and inserted paragraph 51AA to explain their accounting treatment. Paragraph 51 itself is retained, so the other options are wrong.

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