Background: Entity is engaged in the business of development of a special economic zone and industrial park. For development of SEZ, the Entity has purchased, and Government has awarded large parcels of land to the entity. The Company shall develop the land and shall create infrastructure on such land before selling/ leasing the plots to the other businesses. Thus, some portion of land with the entity will be sold in ordinary course of business and some shall be provided on finance lease. Consequently that land shall be classified and presented as “inventory” as per IAS 2 / Ind AS 2 – Inventories in the books of the entity. Due to some legal issues, there are uncertainties regarding the usage of the land and entity is uncertain about the exact usage of the land i.e., whether it will be sold or given on finance lease or operating lease on the date of reporting. Few queries with respect to the accounting of such property have been raised as below. As a part of this blog, we will an...

  In the previous blog of the series on  IPO reporting , we evaluated the accounting framework applicable for the IPO. Accordingly, the issuer company shall prepare restated consolidated financial information to be presented in the offer document based on reporting framework in which they have prepared their latest financial statements before filing the offer document. Even if the latest financial statements are in  Indian GAAP, SEBI  has provided an option to issuer company to adopt Ind AS to restate the financial statements for all three years. Per our view, the issuer company shall opt for the Ind AS reporting framework for the restated financial statements as it reduces time, costs, and efforts of the Company. The company could execute Ind AS restatement as well as IPO restatement at the same time by removing duplication of efforts which otherwise would be performed at different times. In this blog, we will analyze the nature of adjustments required to prepare ‘C...