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Please provide summary on Ind AS 101 - First-time Adoption of Indian Accounting Standards?

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posted Jun 16 by Prachi

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The objective of this IND-AS is to ensure that an entity’s first IND-AS financial statements, and its interim financial reports for part of the period covered by those financial statements, contain high quality information that:
(a) is transparent for users and comparable over all periods presented;
(b) provides a suitable starting point for accounting in accordance with International Financial Reporting Standards (IND-ASs); and
(c) can be generated at a cost that does not exceed the benefits.
An entity shall prepare and present an opening IND-AS statement of financial position at the date of transition to IND-ASs. This is the starting point for its accounting in accordance with IND-ASs.

An entity shall use the same accounting policies in its opening IND-AS statement of financial position and throughout all periods presented in its first IND-AS financial statements. Those accounting policies shall comply with each IND-AS effective at the end of its first IND-AS reporting period.

In particular, the IND-AS requires an entity to do the following in the opening IND-AS statement of financial position that it prepares as a starting point for its accounting under IND-ASs:
(a) recognise all assets and liabilities whose recognition is required by IND-ASs;
(b) not recognise items as assets or liabilities if IND-ASs do not permit such recognition;
(c) reclassify items that it recognised in accordance with previous GAAP as one type of asset, liability or component of equity, but are a different type of asset, liability or component of equity in accordance with IND-ASs; and
(d) apply IND-ASs in measuring all recognised assets and liabilities.

The IND-AS grants limited exemptions from these requirements in specified areas where the cost of complying with them would be likely to exceed the benefits to users of financial statements. The IND-AS also prohibits retrospective application of IND-ASs in some areas, particularly where retrospective application would require judgements by management about past conditions after the outcome of a particular transaction is already known.

The IND-AS requires disclosures that explain how the transition from previous GAAP to IND-ASs affected the entity’s reported financial position, financial performance and cash flows.

answer Jun 17 by Mukul Chag
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