Ind AS 112, Disclosure of Interests in Other Entities (detailed)

Ind AS 112, Disclosure of Interests in Other Entities: The goal of Ind AS 112 is to require an entity to divulge info that makes it possible for users of its monetary statements to assess:

• the nature of, and dangers related to, its interests in other entities; and
• the effects of those interests on its financial position, financial efficiency and cash

The Basic shall be applied by an entity that has an interest in a subsidiary, a joint arrangement (i.e., joint operation or joint venture), an associate or an unconsolidated structured entity.

Considerable judgements and presumptions

Ind AS 112 needs that an entity will divulge info about signi ficant judgements and presumptions it has actually made (and changes to those judgements and presumptions) in identifying:

• that it has control of another entity;-LRB-
• that it has joint control of a plan or significant influence over another entity; and
• the kind of joint plan (i.e., joint operation or joint venture) when the plan has actually been structured through a different

Financial investment entity status under Ind AS 112

When a moms and dad identifies that it is an financial investment entity in accordance with Ind AS 110, the financial investment entity shall reveal info about substantial judgements and presumptions it has made in figuring out that it is an

financial investment entity. If the investment entity does not have several of the normal characteristics of a financial investment entity, it will divulge its reasons for concluding that it is nevertheless a financial investment entity.

When an entity becomes, or stops to be, a financial investment entity, it shall disclose the change of financial investment entity status and the reasons for the change. In addition, an entity that ends up being an investment entity will reveal the result of the change of status on the financial declarations for the duration provided, including:

• the overall reasonable value, as of the date of modification of status, of the subsidiaries that cease to be consolidated;-LRB-
• the overall gain or loss, if any, determined in accordance with Ind AS 110; and
• the line product( s) in profit or loss in which the gain or loss is acknowledged (if not presented independently).

Interest in Subsidiaries

Ind AS 112 needs that an entity should reveal info that allows users of its consolidated monetary statements:–LRB- .

• to comprehend:.
  • the structure of the group; and
  • the interest that non-controlling interests have in the group’s activities and capital; and
• to assess:.
  • the nature and degree of significant limitations on its capability to access or use assets, and settle liabilities, of the group;-LRB- .
  • the nature of, and modifications in, the dangers associated with its interests in combined structured entities;-LRB- .
  • the consequences of modifications in its ownership interest in a subsidiary that do not result in a loss of control; and
  • the repercussions of losing control of a subsidiary throughout the reporting

Interest in unconsolidated subsidiaries (financial investment entities)

Ind AS 112 needs that an investment entity that, in accordance with Ind AS 110, is needed to apply the exception to debt consolidation and rather account for its financial investment in a subsidiary at fair value through revenue or loss must divulge that reality.

For each unconsolidated subsidiary, a financial investment entity will reveal:

• the subsidiary’s name;-LRB-
• the primary place of business (and country of incorporation if various from the principal place of business) of the subsidiary; and
• the proportion of ownership interest held by the financial investment entity and, if various, the proportion of voting rights

If an investment entity is the moms and dad of another investment entity, the moms and dad shall also provide the above disclosures for investments that are managed by its investment entity subsidiary.

A financial investment entity is needed to make disclosures relating to the nature and level of any considerable constraints on the capability of an unconsolidated subsidiary to move funds to the investment entity in the kind of cash dividends or to pay back loans or advances made to the unconsolidated subsidiary by the financial investment entity and any current commitments or intentions to offer financial or other assistance to an unconsolidated subsidiary, etc.

Interest in joint arrangements and associates

Ind AS 112 requires that an entity must disclose info that enables users of its monetary statements to evaluate:

• the nature, level and financial impacts of its interests in joint arrangements and associates, including the nature and impacts of its legal relationship with the other financiers with joint control of, or significant impact over, joint plans and associates; and
• the nature of, and changes in, the risks related to its interests in joint endeavors and

Interests in unconsolidated structured entities

Ind AS 112 also requires that an entity needs to divulge info that makes it possible for users of its monetary declarations:

• to comprehend the nature and extent of its interests in unconsolidated structured entities; and
• to assess the nature of, and changes in, the risks associated with its interests in unconsolidated structured

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