Differences between IFRS and Indian GAAP (Part 3)The portion of profit or loss attributable to the minority interest and to the parent entity is separately disclosed on the face of the income statement as allocations of profit or loss for the period. An entity that discloses an operating result should include all items of an operating nature, including those that occur irregularly or infrequently or are unusual in amount. | | |
Income statement: Each framework requires prominent presentation of an income statement as a primary statement.
1. Format
IFRS: There is no prescribed format for the income statement. The entity should select a method of presenting its expenses by either function or nature; this can either be, on the face of the income statement, as is encouraged, or in the notes. Additional disclosure of expenses by nature is required if functional presentation is used. IFRS requires, as a minimum, presentation of the following items on the face of the income statement:
• Revenue;
• finance costs;
• Share of post-tax results of associates and joint ventures accounted for using the equity method;
• Tax expense;
• Post-tax gain or loss attributable to the results and to re-measurement of discontinued operations; and
• Profit or loss for the period.
The portion of profit or loss attributable to the minority interest and to the parent entity is separately disclosed on the face of the income statement as allocations of profit or loss for the period. An entity that discloses an operating result should include all items of an operating nature, including those that occur irregularly or infrequently or are unusual in amount.
Indian GAAP: There is no prescribed format for the income statement. However, the accounting standards and the Companies Act prescribe disclosure norms for certain income and expenditure items. In practice, the expenses are presented by either function or nature. Other industry regulations prescribe industry-specific format of the income statement.
2. Exceptional (significant) items
IFRS: Separate disclosure is required of items of income and expense that are of such size, nature or incidence that their separate disclosure is necessary to explain the performance of the entity for the period. Disclosure may be on the face of the income statement or in the notes. IFRS does not use or define the term ‘exceptional items’.
Indian GAAP: Similar to IFRS, except that the Companies Act uses the term ‘exceptional items’.
3. Extraordinary items
IFRS: Disclosure of items as extraordinary item is prohibited.
Indian GAAP: These are defined as events or transactions clearly distinct from the ordinary activities of the entity and are not expected to recur frequently and regularly. Disclosure of the nature and amount of each extraordinary item is required in the income statement in a manner that its impact on current profit or loss can be perceived.
Takshila Learning Pvt. Limited is a Delhi based reputed institute, providing various training programmes in finance and accounting branch viz. IFRS Course and US CPA Course. Visit http://www.takshilalearning.com/ to know course detail, fee structure, curriculum and to download free brochure.
Contact Author
Disclaimer: Article submitters are solely responsible for the content of their articles. ArtiLib can't be held liable for the contents of the articles. Report Abuse
| Browse By Category |
