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Class of assets
Financial Reporting
asked 7 hrs ago
Y building under Property C and Property D has not shown separately,
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No answers yet!!
Reshma
CA Final
★ 570
0
1
Qn in the video
Financial Reporting
answered 13 hrs ago
In the qn being discussed before the end of the video, we know on 31st of March that we will continue to operate the business(in the absence of any information given to the contrary) and it is obvious that we will make revenue in the following year, so if we have to see the substance, the entity knows that there lies an obligation to pay the levy once it earns in the next year, so wouldn’ t be prudent to create a provision as we are not sure about the date when we will start to earn in the next year but we are sure that we will pay and a reliable estimate of the amount we have to pay based on the previous year’s earnings as at the end of year 1 and a liability as on 05.04.Y2? Extra doubt on Auditor’s reporting: Because if the FS do not show that levy(for eg. if the levy is 20% of 200crore) then the PnL would be materially be misstated in the absence of accounting for the same isn’t it? Because the understatement of expense in PnL would affect the economic decisions of the users of FS? In that case if the auditor finds it to be misleading, will there be a need for the Mgmt to alter the same and account for the provision or still adhere to what is given in the solution ? [Video Time Stamp: 12:38]
latest answer
In the levy example , the obligation arises only when the entity earns revenue in the next year (Y2). So even though the business continues, as of 31 March Y1, the entity has not yet triggered the event that creates the obligation. Knowledge that the entity will probably earn revenue in Y2 is not a past event, it’s a future event. There is not present obligation (a key component of definition of liability) The obligation becomes present only once the entity starts generating revenue in Y2. We don’t create provisions merely because something is probable and the obligating event must have already occurred.
Venkatesh Rathinam
CA Final
★ 15K+
1
11
Financial instruments
Financial Reporting
answered 1 day ago
How will we know if we hv to pas journal entries in the book of holder or issuer
latest answer
Investment in debentures. So from point of view of investor. This is an example discussed in class.
SHRUTHI CHINNI
CA Final
★ 140
1
11
Why donwe create a provision in the sum instead of a liability
Financial Reporting
answered 13 hrs ago
In the question discussed at the end of the video, why are we creating a provision when we are already obligated to pay and it is payable also we know that we have to pay 3000000, shouldn’t we create a liablity? [Video Time Stamp: 07:55]
latest answer
Generally in case of claims, the final amount may be different. Hence provision is used. If the amount is finalised, we can create a liability.
Venkatesh Rathinam
CA Final
★ 15K+
1
10
Video no 8 CFS Illustration 3 last part
Financial Reporting
answered 12 hrs ago
Siw while preparing CFS we take subsidiary book value + fair value adj Instead of that if we take fair value for subsidiary minus dep is it correct For example Non current assets 6500+3300-15
latest answer
OK sir thank you
Miradevi S
CA Final
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10
Borrowing Cost
Financial Reporting
answered 1 day ago
Hello sir, in the above problem you have considered INR 150,000 to be from specific borrowings. Can we assume that the entire expediture is made out of general borrowings? Would this assumption in the exam be valid? [Video Time Stamp: 08:44]
latest answer
Ok sir thank you.
Shreyas Nayak
CA Final
★ 0
2
13
Present value is more than cash received.
Financial Reporting
answered 19 hrs ago
Sir, in this Illustration , the calculated Present Value of the liability is Rs. 104.22 crores, which is higher than the Rs. 100 crores cash received. How should this excess amount be treated upon initial recognition? [Video Time Stamp: 09:17]
latest answer
If embedded derivative is accounted as separately we will follow derivative principles. Every period end we will check FV and gain or loss will be recognised in PL
K Vamshi
CA Final
★ 14K+
3
32
Effective Interest Rate
Financial Reporting
answered 1 day ago
Sir, for illustration 36, shouldn't we have found the effective interest rate for calculating interest amount.?
latest answer
Okay Sir, thank you.
K Vamshi
CA Final
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2
25
Provision
Financial Reporting
answered 1 day ago
In the Ind As 37 on one side they are saying for provision- future amount is uncertain on the other side they are saying provisin has ability to measure i am bit confused between this. Also Highlighted the words in pages artached. Also amount payable for electricity they said it is not provison as its accrual but in articleship everywhere rent of current month shown as provision only
latest answer
A provision is a liability of uncertain timing or amount. (So either timing is uncertain or amount is uncertain) A provision is recognised when: The entity has a present obligation (legal or constructive) as a result of a past event. It is probable that an outflow of resources will be required to settle the obligation. A reliable estimate of the amount can be made. (Since outflow is probable >50%, we make an estimate and record it) Accrual is where the amount can be measured. For e.g .in case of electricity we know how many units are consumed. IN true sense this is accrual. in real life we use provision and accrual interchangeably (especially in India) So for e.g Salary expense is accrued - we do not create a provision.
Gauri Shete
CA Final
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1
20
illustration 1 , initial measurement
Financial Reporting
answered 1 day ago
where is the question in that given answer in this vedio sir.. no question directly u gave an answer
latest answer
This is an example taken. NOt a specific question.
leela sowjanya
CA Final
★ 10
1
17