Disclousers checklist for accounting standard

Following standards are covered in this Checklist AS-1 — DISCLOSURE OF ACCOUNTING POLICIES AS-2 — VALUATION OF INVENTORIES (REVISED) AS-3 - CASH FLOW STATEMENTS AS-4 — Contingencies and Events occuring after balance sheet date AS-5 — NET PROFIT/LOSS FOR THE PERIOD, PRIOR PERIOD ITEMS AND CHANGES IN ACCOUNTING POLICIES AS-6 — DEPRECIATION ACCOUNTING AS-9 — REVENUE RECOGNITION AS-10 — ACCOUNTING FOR FIXED ASSETS AS-11 (REVISED) — ACCOUNTING FOR EFFECTS OF CHANGES IN FOREIGN EXCHANGE RATES AS-12 — ACCOUNTING FOR GOVERNMENT GRANTS AS-13 — ACCOUNTING FOR INVESTMENTS AS-14 — ACCOUNTING FOR AMALGAMATION AS-16 — BORROWING COSTS AS-17 - SEGMENT REPORTING AS-18 — RELATED PARTY DISCLOSURES AS - 20 Earnings per share AS-22 — ACCOUNTING FOR TAXES ON INCOME AS-23 — ACCOUNTING FOR INVESTMENT IN ASSOCIATES IN CONSOLIDATED FINANCIAL STATEMENT AS-24 — DISCONTINUING OPERATIONS AS-26 — INTANGIBLE ASSETS AS-28 — IMPAIRMENT OF ASSETS AS-29 — PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS AS-1 — DISCLOSURE OF ACCOUNTING POLICIES Index Significant Accounting Policies followed in preparation of accounts be disclosed at one place along with the financial statements Some examples are as follows (a) Basis for preparation of financial statements (b) Method of accounting (c) Valuation of fixed assets and Its revaluation (d) Treatment of goodwill (e) Treatment of Impairment of Assets (f) Method of depreciation, depletion and amortisation (g) Treatment of expenditure during construction (h) Valuation of Inventories, accounting policies used including cost formula used (i) Valuation of Investment & treatment of investment income (j) Research and Development (k) Deferred revenue expenditure (l) Receivables and liabilities (m) Revenue recognition (n) Conversion of translation of foreign currency items (o) Proposed Dividend (p) Taxes on income (q) Claims (r) Financial and managerial systems (s) Intangible assets Any change and financial impact of such change should be disclosed- Effect along with quantification on current period and also on future periods (indicate fact that it cannot be quantified) If fundamental assumptions (going concern, consistency and accrual) are not followed, the fact to be disclosed. Going concern assumption is assessed for a foreseeable period of one year AS-2 — VALUATION OF INVENTORIES (REVISED) Index The financial statements should disclose (a) the accounting policies adopted in measuring inventories, including the cost formula used (b) the total carrying amount of inventories and its classification appropriate to the enterprise AS-3 - CASH FLOW STATEMENTS Index (a) Cash flow statement (b) Supplemental disclosures for non-cash transactions AS-4 — Contingencies and Events occuring after balance sheet date Index (a) If disclosure of contingencies is required by paragraph 11 of the Statement, the following information should be provided: the nature of the contingency, the uncertainties which may affect the future outcome, an estimate of the financial effect, or a statement that such an estimate cannot be made (b) Existence of contingent loss, if any of the conditions of Para 11 are not met (c) Disclosure should be made in the report of the approving authority of those events occurring after the balance sheet date that represent material changes and commitments affecting the financial position of the enterprise (d) If any event occuring after balance sheet date affects financial statement depending on which adjustment is required in the accounts, if not made then to be disclosed with quantification AS-5 — NET PROFIT/LOSS FOR THE PERIOD, PRIOR PERIOD ITEMS AND CHANGES IN ACCOUNTING POLICIES Index (a) Extraordinary Items should be disclosed in the statement of profit and loss as a part of net profit or loss for the period. The nature and amount should be separately disclosed in a manner that impact on loss or prfit can be perceived (b) Prior period Items should be disclosed in the statement of profit and loss as a part of net profit or loss for the period. The nature and amount should be separately disclosed in a manner that impact on loss or prfit can be perceived (c) Accounting Estimate : The effect of a change in an accounting estimate should be included in the determination of net profit or loss in; (a) the period of the change, if the change affects the period only; or (b) the period of the change and future periods, if the change affects both (d) Accounting Policy : Any change in an accounting policy which has a material effect should be disclosed. The impact of, and the adjustments resulting from, such change, if material, should be shown in the financial statements of the period in which such change is made, to reflect the effect of such change. Where the effect of such change is not ascertainable, wholly or in part, the fact should be indicated. If a change is made in the accounting policies which has no material effect on the financial statements for the current period but which is reasonably expected to have a material effect in later periods, the fact of such change should be appropriately disclosed in the period in which the change is adopted. (e)A change in accounting policy consequent upon the adoption of an Accounting Standard should be accounted for in accordance with the specific transitional provisions, if any, contained in that Accounting Standard. Otherwise disclosures as per clause (d) above AS-6 — DEPRECIATION ACCOUNTING Index (a) Allocate depreciable amount of a depreciable assets on systematic basis to each accounting year over useful life of asset, useful life may be reviewed periodically , Basis must be consistently followed and disclosed. Any change to be quantified and disclosed. (b) Rates of depreciation should be disclosed. (c) Deficiency or surplus in case of transfer/change in method be disclosed (d) Historical cost, depreciation for the year and accumulated depreciation be disclosed (e) Change in method of charging depreciation is change in accounting policy be disclosed (As per AS-5) Index AS-9 — REVENUE RECOGNITION Index (a) If revenue recognition is postponed, the circumstance for such postponement be disclosed (b) Disclosure requirement of exceise duty AS-10 — ACCOUNTING FOR FIXED ASSETS Index Revaluation is permitted provided it is done for the entire class of assets. The basis of revaluation should be disclosed. Include details such as Method adopted for revaluation, nature of indices used, year of appraisals made, External valuer invoved Gross and net book values at beginning and end of year showing additions, deletions and other movements is required to be disclosed Hire purchase/Assets taken on lease accounted as per AS-19, in case of joint ownership adequate discosure is required Index AS-11 (REVISED) — ACCOUNTING FOR EFFECTS OF CHANGES IN FOREIGN EXCHANGE RATES Index Amount of exchange difference included in Profit & Loss Account Net exchange differences accumulated in foreign currency translation reserve. A reconciliation of the amount of such exchange differences at the beginning and end of the period When the reportimg currency is different from domestic currency, the reason for using different currency must be disclosed Gains or losses on accounting of forward contracts is recognised through profit and loss account (unless it relates to fixed assets ) Profit/Loss on cancellation or renewal of forward exchange contract shall be recognised as income/expenses of the respective period When there is a change in the classification of a significantforeign operation, an enterprise should disclose: (a) the nature of the change in classification; (b) the reason for the change; (c) the impact of the change in classification on shareholders’ funds; and (d) the impact on net profit or loss for each prior period presented had the change in classification occurred at the beginning of the earliest period presented. The effect on foreign currency monetary items or on the financialstatements of a foreign operation of a change in exchange rates occurringafter the balance sheet date is disclosed in accordance with AS 4,Contingencies and Events Occurring After the Balance Sheet Date Disclosure is also encouraged of an enterprise’s foreign currencyrisk management policy. AS-12 — ACCOUNTING FOR GOVERNMENT GRANTS Index Grants receivable as compensation of losses/expenses incurred be recognised and disclosed in Profit & Loss Account in the year it is receivable and shown as extraordinary item , appropriately read with AS-5 Contingency related to grant be treated in accordance with AS-4 and hence the disclosure under AS-4 will also apply to the contingencies relating to Grants and related conditions attached Grants when become refundable, be shown as extraordinary item read with AS-5 Accounting policy adopted for grants including method of presentation The nature and extent of Government grants including nonmonetary assets received atconcessional rate or free of cost AS-13 — ACCOUNTING FOR INVESTMENTS Index Index Index Index Current investments and long-term investments shall be disclosed distinctly with further sub-classification. The accounting policy adopted - classification of investments income from investments, profit/loss on disposal and changes in carrying amount of such investment - aggregate amount of quoted and unquoted investments giving aggregate market value of quoted investments Significant restrictions on right of ownership, realisation of investment and remittance of income and proceeds of disposal thereof be disclosed Following disclosures in Profit and loss account Interest, dividends (showing separately dividends fromsubsidiary companies), and rentals on investments showingseparately such income from long term and currentinvestments. Gross income should be stated, the amount ofincome tax deducted at source being included underAdvance Taxes Paid; Profits and losses on disposal of current & long term investments and changes in carrying amount of such investments Other disclosures as specifically required by the relevant statutegoverning the enterprise. AS-14 — ACCOUNTING FOR AMALGAMATION Index If different treatment is prescribed in scheme as compared to the requirements of AS, following disclosures be made in the financial statements (a) Deviations in the accounting treatment given to the reserves as prescribed by the scheme of amalgamation sanctioned under the statute as compared to the requirements of AS-14 (b) The financial effect, if any arising due to such deviation. Whether following disclosures made in first financial statement following amalgamation: (a) Name and general nature of business of amalgamating companies (b) Effective date of amalgamation (c) Method of accounting used to reflect amalgamation (d) Particulars of the scheme sanctioned under the Companies Act, 1956 If amalgamation under pooling of interest method, whether additional disclosure made in first financial statement following the amalgamation of the following: (a) Description and number of shares issued, together with percentage of equity share exchanged to effect amalgamation (b) Amount of any difference between the consideration and the value of net identifiable asset acquired and the treatment thereof If amalgamation in nature of purchase, whether additional disclosure made in the first financial statement following the amalgamation of the following: (a) Consideration for the amalgamation and a description of the consideration paid or contingently payable (b) The amount of any difference between the consideration and the value of net identifiable assets acquired, and the treatment thereof including the period of amortisation of any goodwill arising on amalgamation When an amalgamation is effected after the balance sheet date but before the issuance of the financial statements of either party to the amalgamation, disclosure is made in accordance with AS 4, ‘Contingencies and Events Occurring After the Balance Sheet Date’, but the amalgamation is not incorporated in the financial statements. In certain circumstances, the amalgamation may also provide additional information affecting the financial statements themselves, for instance, by allowing the going concern assumption to be maintained. AS-16 — BORROWING COSTS Index Financial statements to disclose accounting policy adopted for borrowing cost and also the amount of borrowing costs capitalised during the period AS-17 - SEGMENT REPORTING Index An enterprise should disclose the following for each reportable segment (a) segment revenue, classified into segment revenue from salesto external customers and segment revenue from transactionswith other segments; (b) segment result; (c) total carrying amount of segment assets; (d) total amount of segment liabilities; (e) total cost incurred during the period to acquire segment assetsthat are expected to be used during more than one period(tangible and intangible fixed assets); (f) total amount of expense included in the segment result fordepreciation and amortisation in respect of segment assetsfor the period; and (g) total amount of significant non-cash expenses, other thandepreciation and amortisation in respect of segment assets,that were included in segment expense and, therefore,deducted in measuring segment result Disclosure under the Standard is not required in the following cases (i) If such disclosure conflicts with duty of confidentially under statute, duty cast by a regulator or a competent authority; (ii) In consolidated financial statements in respect of intragroup transactions, and (iii) In case of State-controlled enterprises regarding related party relationships and transactions with other State-controlled enterprises. If there are transactions between the related parties, during the existence of relationship, certain information is to be disclosed, viz.; name of the related party, description of the nature of relationship, nature of transaction and its volume (as an amount or proportion), other elements of transaction if necessary for understanding, amount or appropriate proportion outstanding pertaining to related parties, provision for doubtful debts from related parties, amounts written off or written back in respect of debts due from or to related parties Names of the related party and nature of related party relationship to be disclosed even where there are no transactions but the control exists List following: Holding companies Subsidiary companies Fellow subsidiaries Persons who has substantial interest in voting power (20% or more) and power to direct, by statute or agreement the financial and/or operating policies of the reporting enterprise and vice versa Persons able to appoint or remove all or majority of directors of the reporting enterprise or vice versa List of following : Associates Joint Ventures Individuals, directly or indirectly having voting power to control or significantly influence over the reporting enterprise Relatives of such individuals Key management personnel Relatives of such pesonnel Enterprises owned or significantly influenced by individuals or their relatives, who have direct or indirect control or significant influence over the reporting enterprise? Enterprises owned or significantly influenced key management personnel or their relatives If transactions have taken place during the period with parties listed in either of above: Disclose the following AS-18 — RELATED PARTY DISCLOSURES Index The name of the transacting related party Description of the relationship Description of the nature of transaction Volume of transaction in amount Outstanding amount of year end and provision made for doubtful debts relating thereto Amount written off or written back in the period in respect of such due from or to such parties Any other item of transaction (e.g interest free loans, no repayment period, use of group trademarks, etc.) necessary for an understanding of the financial statement If disclosure for are not made partywise(as required above), are items of similar nature disclosed in aggregate by type of related AS-19 — LEASES ( Level I) Index For Finance Leases (a) All assets under leases should be segregated from owned assets and shown separately (b) Net carrying amount for each classes of asset (c) Finance charges recognised in the P&L (d) A reconciliation between MLP and PV on balance sheet date (e) An age wise break up of MLP and PV classified into Upto one year > 1 year <= 5 years > 5 years Total future minimum sub lease payments, if any Contingent rent, if any recognised in P&L Significant terms under lease agreement such as Basis of recognition of contingent rent Clauses governing Renewal, purchase option, or escalation Restricitve covenants, if any, e.g. dividends, additional debts, further leasing, etc Liability should be disclosed separately as "long term" and "current liability" ; ; pending………………………………… AS - 20 Earnings per share mandatory disclosures (a) Positive as also as negative earnings per share (b) Both basic EPS and Diluted EPS for current period, and previous period, should be disclosed with EQUAL PROMINENCE (c) EPS figures to be restated, following post balance sheet bonus issue (d) The numerator used in Basic EPS and diluted EPS and their reconciliation with reported figures (e) The denominator used in basic EPS and Diluted EPS and their reconciliation with each other (f) The nominal value of shares along with the EPS (g) The BEPS and DEPS should be computed after excluding extraordinary items and reported in addition to the BEPS and DEPS computed and reported after including extraordinary items (h) If any other eEPS (say cash EPS) is computed, reconciliation between the numerator used and some line in the income statement say Profit after tax should b drawn The level II and II enterprises are exepmpt from disclosure of diluted earnings per share and also disclosures prescribed in para (d) and (e) above Additional Disclosures in the following areas are encouraged: (a) Componets of net profit (Example : NP from ordinary activities) (b) Disclosures of the terms and conditions of contracts generating potential equity shares (c) Description of equity share and potential equity share transactions occuring after balance sheet date whih are of such importnance that non-disclosure would affect ability of user of financial statements to make proper evaluation anf decision. The Areas are: * Issue of shares for cash *Issue of shares when the proceeds are used to repay debt or preference shares outstanding at the balance sheet date *cancellation of equity shares outstanding at the balance sheet date * Conversion of potential equity shares, outstanding at the balance sheet date, into equity shares * Issue of warrants, options or convertible securities, and the satisfaction of conditions that would result in the issue of Contingently issuable shares AS-22 — ACCOUNTING FOR TAXES ON INCOME Index DTA/DTL to be disclosed separately from current tax DTA is to be shown after Investments but before current assets and DTL is disclosed after unsecured loans but before current liabilities in the balance sheet Break-up of DTA/DTL into major components of balances disclosed in notes to accounts The nature of evidence supporting the recognition of DTA disclosed when DTA comprises of unabsorbed depreciation or carried forward losses AS-23 — ACCOUNTING FOR INVESTMENT IN ASSOCIATES IN CONSOLIDATED FINANCIAL STATEMENT Index Disclose Reasons for not applying equity method in accounting for investments Goodwill/capital reserve arising on acquisition separately in the carrying amount of investment in the associate Name and description of associate, including the proportion of ownership interest and if different, the proportion of voting power held Investments in associates classified as long-term investments and shown separately? Share of profit or losses and share of extraordinary or prior period items separately disclose Difference in reporting date(s) along with the names of the associate(s) Difference in accounting policies not adjusted in financial statements and a brief description of the differences in the accounting policies AS-24 — DISCONTINUING OPERATIONS Index (a) With respect to a discontinuing operation, the initial disclosure event is the occurrence of one of the following, whichever occurs earlier (a) the enterprise has entered into a binding sale agreement for substantially all of the assets attributable to the discontinuing operation; or (b) the enterprise’s board of directors or similar governing body has both (i) approved a detailed, formal plan for the discontinuance and (ii) made an announcement of the plan. (b) Any disclosures required by this statement should be resented separately for each discontinuing operation. In relation to initial disclosures A description of the discontinuing operation Business or geographical segment as reported in segment reporting Date and nature of the initial disclosure events Date or period in which the discontinuance expected to be completed if known or determinable The carrying amount as of the balance sheet date of the total assets (to be disposed of) and liabilities (to be settled) Amount of revenue and expenses in respect of the ordinary activities attributable to discontinuing operation during the current year Amount of profit/loss before tax and income tax (current and deferred) thereon from ordinary activities attributable to discontinuing operation (to be disclosed in P&L) Amount of net cash flow attributable to operating, investing and financing activities of discontinuing operation during the current year In relation to other disclosures, when the events occur; The amounts of pre-tax gain or loss and income tax expense relating thereto on disposal of assets or settlement of liabilities attributable to the discontinuing operation? (to be disclosed in P&L) The net selling price or range of prices of those net assets for which one or more binding sale agreements are entered into, the expected timing of receipt of those cash flows, and the carrying amount of those net assets on the balance sheet date In relation to updating of disclosures; Description of any significant changes in the amount or timing of cash flows relating to the assets to be disposed or liabilities to be settled and events causing such changes In relation to completion of discontinuance; Disclosure to be made till the plan is substantially completed or abandoned, though full payment may not yet have been received from the buyer In relation to abandonment or withdrawal of plans previously reported as a discontinuing operation. Fact, reasons therefor and its effects be disclosed AS-26 — INTANGIBLE ASSETS Index For each class of intangible assets, distinguishing between internally generated intangible assets and other intangible assets the following are disclosed * The useful life or the amortisation rates used * The amortisation method used * The gross carrying amount and the accumulated amortisation at the beginning and end of the period * A reconciliation of the carrying amount at the beginning and end of the period showing: ** Additions, indicating separately those from internal development and through amalgamation ** Retirements and disposals ** Impairment losses recognised/reveresed in the statement of profit and loss during the period ** Amortisation recognised during the period ** Other change in the carrying amount during the period * The reasons why it is presumed that the useful life of intangible asset will exceed ten years, if an intangible asset is amortised over more than ten years * A description, the carrying amount and remaining amortisation period of any individual intangible asset that is material to the financial statements of the enterprise as a whole * The existence and carrying amounts of intangible assets whole title is restricted and the carrying amount of intangible asset pledged as security for liabilities * The amount of commitments for the acquisition of intangible assets * Aggregate amount of research of development expenditure recognised as an expense during the period * Description of any fully amortised intangible asset still in use. (optional disclosure) AS-28 — IMPAIRMENT OF ASSETS Index Following disclosures Amount of impairment losses /reversal of impairment losses recognised in the statement of profit and loss during the period and line item(s) of the statement of profit and loss in which those impairment losses are included The amount of impairment losses recognised directly against revaluation surplus during the period The amount of reversal of impairment losses recognised directly in revaluation surplus during the period Has the enterprise that applies AS-17, Segment Reporting disclosed the following for each reportable segment based on primary format Amount of impairment losses recognised in the statement of profit and loss and directly against revaluation surplus during the period Amount of reversal of impairment losses recognised in the statement of profit and loss and directly in revaluation surplus during the period Index If impairment loss for an individual asset or a cash-generating unit recognised or reversed during the period is material to the financial statement, as a whole, has the enterprise disclosed: * The events and circumstances that led to the recognition or reversal of the impairment loss * the amount of the impairment loss recognised or reversed; * for an individual asset: **the nature of the asset; ** the reportable segment to which the asset belongs, based on the enterprise’s primary format (as defined in AS 17, Segment Reporting); * for a cash-generating unit: (i) a description of the cash-generating unit (such aswhether it is a product line, a plant, a business operation,a geographical area, a reportable segment as definedin AS 17 or other); (ii) the amount of the impairment loss recognised or reversedby class of assets and by reportable segment based onthe enterprise’s primary format (as defined in AS 17);and (iii) if the aggregation of assets for identifying the cashgeneratingunit has changed since the previous estimateof the cash-generating unit’s recoverable amount (if any),the enterprise should describe the current and former wayof aggregating assets and the reasons for changing theway the cash-generating unit is identified; * whether the recoverable amount of the asset (cash-generatingunit) is its net selling price or its value in use; * if recoverable amount is net selling price, the basis used todetermine net selling price (such as whether selling pricewas determined by reference to an active market or in someother way); and * if recoverable amount is value in use, the discount rate(s)used in the current estimate and previous estimate (if any) ofvalue in use If impairment Losses recognised (reversed) during the period are material in aggregate to the financial statements of the reporting enterprise as a whole, an enterprise should disclose a brief description of the following: * the main classes of assets affected by impairment losses (reversals of impairment losses) for which no information is disclosed under paras above; * the main events and circumstances that led to the recognition (reversal) of these impairment losses for which no information is disclosed under paras above An enterprise is encouraged to disclose key assumptions used todetermine the recoverable amount of assets (cash-generating units) duringthe period. AS-29 — PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS Index following disclosures been made as required by the Accounting Standard For each class of provision (not applicable to level III enterprise) * The carrying amount at the beginning and end of the period * Additional provision made in the period? * Amount used during the period * Unused amounts reversed during the period For each class of provision (not applicable to level II enterprise) * A brief description of the nature of obligation and the expected timing of any resulting outflows of economic benefits * An indication of the uncertainties about those outflows * The amount of any expected reimbursement, stating the amount of any assets that has been recognised for that expected reimbursement For each class of contingent liability along with a brief description (Applicable to All) * An estimate of its financial effect * An indication of the uncertainties relating to any outflow * The possibility of any reimbursement