Section 234A of the Income Tax Act, 1961 provides for the payment of interest on the amount of tax that is not paid by the due date. This interest is commonly referred to as “Interest under Section 234A”. The purpose of this provision is to encourage taxpayers to pay their taxes on time and to …
Internal Audit and Internal Control over Financial Reporting (ICFR) are two distinct concepts under the Companies Act. Let’s explore the differences between them and refer to the relevant sections of the Companies Act. Internal Audit: Internal audit is a process conducted within an organization to assess and improve the effectiveness of risk management, control, and …
The Finance Act of 2021 brought about significant changes to the provisions governing the reopening of assessments for previous assessment years. Erstwhile Sections 147 to 151 were substituted with amended Sections 147, 148, 148A, 149, 150, and 151, effective from April 1, 2021. Consequently, any notice for reopening assessments issued after April 1, 2021, is …
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Section 234C of the Income Tax Act, 1961 deals with the provisions related to the interest for default in payment of advance tax. It states that if an individual or a company fails to pay the advance tax or pays less than 90% of the assessed tax liability before the end of the financial year, …
Section 43A and 43AA are provisions under the Income Tax Act that deal with the method of accounting for certain specified transactions. Section 43A relates to the method of accounting for certain specified transactions in respect of which the taxpayer has opted for the mercantile system of accounting. The transactions covered under this section include …
Professional Services vs. Technical Services: Section 194C vs. Section 194J: Section 194C: This section covers payments made for contracts, including sub-contracts, for work such as advertising, broadcasting, carriage of goods, etc. Tax needs to be deducted at source (TDS) at the specified rates when making such payments. Section 194J: This section pertains to fees for …
Different b/w professional service and technical services Read More »
1.What happens to the unabsorbed depreciation of the previous owner when there is a change in ownership? A:When there is a change in ownership of a business, the unabsorbed depreciation of the previous owner can be carried forward and set off against the profits of the new owner. This provision is covered under Section 32(2) …
Questions on Set off and Carry Forward in which there is change in ownership Read More »
As per Section 115BBE of the Income Tax Act, any unexplained income, which is deemed to be the income of the assessee under Section 68 to Section 69D, is taxed at a flat rate of 60%. This is applicable for the financial year 2021-22 and onwards. Favorite
Section 270A of the Income Tax Act, 1961 provides for penalty for misreporting of income. The penalty amount is equal to 200% of the amount of tax payable on under-reported income. Under-reported income means the difference between the income assessed by the Assessing Officer and the income returned by the taxpayer. Favorite
Unabsorbed depreciation can be carried forward for an indefinite period until it is fully absorbed. However, it can only be set off against income from the head “Profits and gains of business or profession.” Business losses can be carried forward for up to 8 assessment years immediately following the assessment year for which the loss …
For how many years’ unabsorbed depreciation and business losses be carried forward? Read More »
Liquidity Ratios: 1.Current Ratio: Current Assets / Current Liabilities 2.Quick Ratio: (Current Assets – Inventory) / Current Liabilities 3.Cash Ratio: Cash and Cash Equivalents / Current Liabilities Coverage Ratios: 4. Debt-to-Equity Ratio: Total Debt / Total Equity 5.Debt-to-Asset Ratio: Total Debt / Total Assets 6.Interest Coverage Ratio: Earnings Before Interest and Taxes (EBIT) / Interest …
Because Market value is attributable to equity holders and EBITDA is attributable to both equity and debt holders. When we calculate any multiple, we should take numerator and denominator for either equity holders only or both equity and debt holders like below ratios: Equity multiples – P/E, P/BV, P/TBV Firm wide multiples: EV/ EBITDA, EV …
Why is Market Cap/EBITDA not a good comparable multiple? Read More »
A stock split is a corporate action in which a company increases the number of its outstanding shares by issuing additional shares to current shareholders, while maintaining the same overall value of the company. For example, in a 2-for-1 stock split, shareholders would receive two shares for every one share they currently own, effectively halving …
A rights issue, also known as a rights offering, is a type of corporate fundraising method in which a company offers its existing shareholders the right to purchase additional shares in proportion to their current shareholding. The new shares are typically offered at a discounted price compared to the market price. The purpose of a …
A bonus issue, also known as a bonus share issue or scrip issue, is a corporate action in which a company issues additional shares to its existing shareholders at no cost. These bonus shares are distributed to shareholders in proportion to their current shareholding. The purpose of a bonus issue is to reward existing shareholders …
Enterprise Value, or EV for short, is a measure of a company’s total value, often used as a more comprehensive alternative to equity market capitalization. The market capitalization of a company is simply its share price multiplied by the number of shares a company has outstanding. Enterprise value is calculated as the market capitalization plus …
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Accumulated depreciation is the total amount of the depreciation expenditure allocated to a particular asset since the asset was used. It is a contra asset account, i.e. a negative asset account that offsets the balance in the asset account with which it is usually linked. The accumulated balance of depreciation increases over time, adding the …
Provision Provision liability reduces an asset’s value because of a present obligation arising out of a past event The event which can result in a provisional liability may or may not occur. The estimated amount of the provisional liability is not certain Any increase or decrease in provision liability gets recorded in the Profit and …
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In auditing, the “Nature, Timing, and Extent of Audit” refer to critical factors that auditors consider when planning and conducting an audit engagement. These factors are addressed in the Standard on Auditing (SA) 200 – “Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance with Standards on Auditing.” Reference: SA …
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Sampling is a technique used in various fields, including auditing, to select a representative subset of items from a larger population. It is employed when it is not feasible or practical to examine every single item within the population. Sampling helps draw conclusions about the entire population based on the analysis of the selected sample. …
This is one of the most joked about HR questions – obviously you don’t know where you’ll be. The interviewer also would not have known 5 years back that this is where he would be. But, the reason why companies ask this is to see whether your long term goals match with theirs. Your answer …
It is an Australian global financial services Company, Founded on 1969 as Hill Samuel Australia Limited, a Subsdiary of UK’s Hill Samuel & Co. Limited. 18000+ employees from 68 country speaking 70 language working in 33 market segments. World largest Infrastructure Asset mgmt co. with more than 737 Bn $ under AUM. It has invested …
Shares and bonds are both financial instruments used to raise capital, but they differ in several ways: 1.Ownership: Shares represent ownership in a company, while bonds represent a loan to a company. 2.Return: Shareholders are entitled to a share of the company’s profits in the form of dividends and capital gains, while bondholders receive a …
The entry to record a prepaid expense involves the following steps: 1.Debit the Prepaid Expense account for the amount paid. 2.Credit the Cash or Bank account for the amount paid. When the expense is incurred, the prepaid asset is recognized as an expense in the income statement, and the entry to record this is: 1.Debit …
The Indian Accounting Standard (Ind AS) 19 aims to prescribe accounting and disclosure for employee benefits. It requires recognition of the liability by an entity when an employee provides services for employee benefits to be paid in the future, and recognition of expenses when the entity utilises the economic benefit arising from service given by …
As per IFRS 10 in the process of preparing consolidated financial statements, certain transactions and balances between the parent company and its subsidiaries may need to be eliminated. This is done to ensure that the financial statements of the group do not reflect transactions and balances that occur between entities within the group, as this …
Financial risk management is the process of identifying, assessing, and managing various types of financial risks that a company may face in its operations. Financial risks can arise from a variety of sources such as market fluctuations, credit risks, liquidity risks, interest rate risks, currency risks, and commodity price risks. Effective financial risk management involves …
A swap is an agreement between two parties to exchange sequences of cash flows for a set period. Usually, at the time the contract is initiated, at least one of these series of cash flows is determined by a random or uncertain variable, such as an interest rate, foreign exchange rate, equity price or commodity …
Future and forward contracts are both types of derivatives that allow parties to enter into an agreement to buy or sell an asset at a predetermined price on a future date. However, there are some key differences between the two: Future Contracts: A future contract is a standardized agreement traded on an exchange, where the …
The main difference between call and put options lies in the rights and obligations they grant to the holder. Here are the key distinctions: Call Options: A call option gives the holder the right, but not the obligation, to buy an underlying asset at a specified price (strike price) within a predetermined period. The holder …
Option trading refers to a financial derivative strategy that involves the buying or selling of options contracts. Options are financial instruments that give the holder the right, but not the obligation, to buy or sell an underlying asset at a predetermined price (strike price) within a specified period. Option trading allows investors to speculate on …
A derivative is a security with a price that is dependent upon or derived from one or more underlying assets. The derivative itself is a contract between two or more parties based upon the asset or assets. Its value is determined by fluctuations in the underlying asset. The most common underlying assets include stocks, bonds, …
Ind AS 109, Financial Instruments, establishes principles for the recognition, measurement, presentation, and disclosure of financial instruments. It applies to various types of financial instruments, including financial assets, financial liabilities, and some contracts to buy or sell non-financial items. The standard introduces a classification and measurement framework for financial assets based on their contractual cash …
Ind AS 105, Non-current Assets Held for Sale and Discontinued Operations, provides guidance on the accounting treatment for non-current assets that are classified as held for sale and the presentation of discontinued operations in the financial statements. The standard defines non-current assets held for sale as assets that are available for immediate sale in their …
Ind AS 105 Non-current Assets Held for Sale and Discontinued Operations: Read More »
Ind AS 103, Business Combinations, provides guidance on the accounting treatment for the acquisition of businesses or entities. It outlines the principles and requirements for recognizing and measuring the assets, liabilities, and goodwill arising from a business combination. Under Ind AS 103, a business combination occurs when an entity obtains control over one or more …
Ind AS 102, Share-based Payment, provides guidance on the accounting treatment for transactions in which an entity issues equity instruments as part of its employee compensation arrangements or in exchange for goods or services. Under Ind AS 102, share-based payment transactions are recognized as expenses in the financial statements based on their fair value at …
Ind AS 101, First-time Adoption of Indian Accounting Standards, provides guidance on how entities should prepare and present their financial statements when transitioning from previous accounting practices to Indian Accounting Standards (Ind AS). Under Ind AS 101, entities are required to apply Ind AS retrospectively, meaning that financial statements must be restated as if Ind …
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Ind AS 41, Agriculture, provides guidance on the recognition, measurement, and disclosure of agricultural activities and agricultural produce. The standard applies to entities that engage in agricultural activities, which involve the management of biological transformation and the harvest of biological assets for sale or for conversion into agricultural produce. Under Ind AS 41, biological assets …
Ind AS 38, Intangible Assets, provides guidance on the recognition, measurement, and disclosure of intangible assets. Intangible assets are identifiable non-monetary assets without physical substance that are controlled by an entity and have the potential to generate future economic benefits. Under Ind AS 38, an intangible asset is recognized if it meets certain criteria, including …
Ind AS 40, Investment Property, outlines the accounting treatment and disclosure requirements for investment properties, which are properties held to earn rental income, capital appreciation, or both. The standard applies to all entities that hold investment properties, regardless of whether the properties are owner-occupied or leased out to others. Under Ind AS 40, investment properties …
Ind AS 36, Impairment of Assets, provides guidelines for assessing and recognizing impairment losses on assets. The standard applies to all assets, except for certain financial assets and assets covered by other Ind AS standards. Under Ind AS 36, entities are required to test their assets for impairment whenever there is an indication of potential …
Ind AS 34, Interim Financial Reporting, sets out the requirements for preparing and presenting interim financial statements, which provide condensed financial information for an entity’s financial performance, position, and cash flows during a shorter reporting period such as a quarter or half-year. The standard requires entities to prepare interim financial statements that include, at a …
Ind AS 33, Earnings per Share (EPS), sets out the principles for calculating and presenting earnings per share, which is an important financial indicator used by investors and analysts to assess the profitability of a company on a per-share basis. The standard requires entities to calculate basic EPS and, if applicable, diluted EPS. Basic EPS …
Ind AS 24, Related Party Disclosures, establishes the requirements for disclosing information about relationships and transactions with related parties. The standard aims to enhance transparency and ensure that financial statements provide relevant and reliable information about an entity’s relationships with related parties and the potential impact of these relationships on its financial position and performance. …
Ind AS 23, Borrowing Costs, provides guidance on the accounting treatment of borrowing costs incurred by an entity. The standard aims to ensure that borrowing costs directly attributable to the acquisition, construction, or production of qualifying assets are appropriately capitalized. According to Ind AS 23, borrowing costs that are directly attributable to the acquisition, construction, …
Ind AS 8, Accounting Policies, Changes in Accounting Estimates, and Errors, provides guidance on the selection and application of accounting policies, as well as the treatment of changes in accounting estimates and correction of errors. The standard aims to enhance the reliability and comparability of financial statements by ensuring consistent and appropriate accounting practices. Ind …
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Ind AS 7, Statement of Cash Flows, provides guidance on the presentation and disclosure of cash flows from operating, investing, and financing activities in the financial statements. The standard aims to enhance the usefulness and comparability of financial statements by providing users with information about an entity’s liquidity, solvency, and financial adaptability. Ind AS 7 …
Ind AS 2, Inventories, provides guidance on the accounting treatment and valuation of inventories. It applies to all entities that hold inventories for sale, production, or use in the ordinary course of business. The standard defines inventories as assets held for the purpose of being sold, used in production, or consumed in the process of …
Ind AS 1, Presentation of Financial Statements, sets the guidelines for the preparation and presentation of financial statements in accordance with the Indian Accounting Standards. This standard serves as a comprehensive framework to ensure that financial statements provide relevant, reliable, comparable, and understandable information to users. Ind AS 1 begins by establishing the overall framework …
An increase in accounts receivable could be driven by various factors within a company’s operations, financial management, or external environment. Here are some possible drivers of an increase in accounts receivable: Sales Growth: If the company is experiencing higher sales or increased business activity, it may lead to a larger volume of credit sales and …
If accounts receivable are going up, what could be the possible driver? Read More »
Forecasting costs involves estimating future expenditures that a company will incur as part of its operations. This process is essential for budgeting, financial planning, and decision-making. Here’s a detailed approach to forecasting costs, along with examples of various types of costs: 1. Historical Data Analysis: Gather historical cost data over a defined period. Analyze trends, …
A “good” budget is one that serves as an effective financial planning and management tool, aligns with an organization’s goals, and provides a clear roadmap for allocating resources. It should help the organization achieve its objectives, manage its finances efficiently, and adapt to changing circumstances. Here are the key attributes that make a budget “good”: …
Modeling working capital for a company involves projecting and managing the company’s short-term assets and liabilities, such as accounts receivable, accounts payable, and inventory. The goal is to ensure that the company has sufficient liquidity to cover its operational needs. Here’s a step-by-step approach to modeling working capital: Understand Components: Familiarize yourself with the key …
The hallmarks of a good FP&A financial model: Accuracy and Reliability: The model should produce accurate and reliable results. It should be free from errors and able to handle complex calculations while maintaining data integrity. Flexibility and Scalability: The model should be adaptable to changes in business conditions, assumptions, and scenarios. It should easily accommodate …
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Note: Students are advised to go through the Financial Statements and Annual reports of the specific company beforehand. Let’s start with the Profit and Loss (P&L) statement, also known as the income statement. The P&L statement provides a summary of the company’s revenues, expenses, and profits over a specific period, typically a quarter or a …
Can you walk us through the P&L and Balance sheet of our company? Read More »
Revenue Forecasting for Telecom Industry: Key Drivers/Metrics: Subscriber Growth: The number of new subscribers and the churn rate (subscriber attrition) directly impact revenue. Average Revenue Per User (ARPU): Calculated by dividing total revenue by the number of subscribers, ARPU reflects the average revenue generated from each customer. Data Usage: As data consumption increases, revenue from …
Variance commentaries are essential for explaining the reasons behind deviations between actual financial results and the budget or forecast. They help stakeholders understand the factors contributing to performance variations. Some common types of variance commentaries include: Volume Variance Commentary: This type of commentary explains variances resulting from differences in sales volumes or production quantities. It …
A general answer and a structured answer are given below – General Answer: Improving margins and profits is an important goal for any business, and there are several strategies that can be implemented to achieve this. Increase sales: One of the most straightforward ways to improve margins and profits is to increase sales. This can …
How can you improve margins/profits? Give an example. Read More »
Variance analysis is a technique used in financial and managerial accounting to analyze the difference between planned or budgeted figures and actual performance. It helps organizations understand the reasons behind variations and deviations from expected outcomes, allowing them to make informed decisions and take corrective actions. Variance analysis is widely used to assess performance, identify …
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ERP systems that are commonly used for budgeting and forecasting by organizations: SAP ERP: SAP offers a range of modules, including SAP Financials and SAP Business Planning and Consolidation (BPC), which can be used for budgeting and forecasting. Oracle ERP Cloud: Oracle provides cloud-based ERP solutions, including modules for financial planning and budgeting. Microsoft Dynamics …
Mention the ERP you have used in budgeting and forecasting? Read More »
Past data is usually the best starting point for both forecasting and budgeting. An exception is zero based budgeting (where past data is not used). While building a budget, following steps can be followed: a) Reviewing and understanding all the required inputs for your budget. b) Analyzing previous budgets and other historical data. This will …
Budgeting – Budgeting creates a baseline to compare actual results to determine how the results vary from the expected performance. It is setting a target. It is more relevant for items that are under your control such as costs Forecasting- Forecasting estimates a company’s future outcomes. Financial forecasting allows management teams to anticipate …
RTGS (Real Time Gross Settlement) and NEFT (National Electronic Funds Transfer) are both electronic payment systems used in India, but they differ in terms of transaction processing, settlement timings, and transaction limits. Here are the key differences between RTGS and NEFT: Transaction Processing: RTGS enables real-time and immediate transfer of funds on a gross basis, …
Accounts payable (AP) and accounts receivable (AR) are two types of financial transactions that businesses engage in. Accounts payable (AP) represents the amount of money a company owes to its suppliers or vendors for the goods or services they have provided. In other words, it is the amount of money that a business owes to …
What is the difference between accounts payable and accounts receivable? Read More »
Accruals refer to expenses or revenues that have been recognized in the accounting records before they have been paid or received, respectively. They are recorded to reflect the economic activity of a business accurately, even if the cash transactions have not yet taken place. There are two types of accruals: Accrued expenses (Accrued liabilities): These …
Prepaid expenses are expenses that have been paid in advance but have not yet been used or consumed. They represent costs that are paid for upfront but will be recognized as expenses over a future period. Examples of prepaid expenses include: Rent: If a company pays rent for the next six months in advance, it …
The principles of accounting are the basic guidelines and concepts that underlie the preparation and presentation of financial statements. These principles include the accrual basis of accounting, the consistency principle, the materiality principle, the going concern principle, the entity principle, the historical cost principle, the matching principle, the full disclosure principle, the conservatism principle, and …
Accounting concepts are ideas, assumptions and conditions based on which a business entity records its financial transactions and organises its bookkeeping. It helps a business interpret and integrate a financial transaction into the accounting process. There are several accounting concepts that are important to understand: Entity concept: This concept states that the business entity should …
Clarify from the interviewer what they mean. Are they asking you for specific directions of Ind AS 108, or a general discussion on policies. If the former, check the detailed answer on Ind AS 108. Else use this answer. As per Ind AS 108, the accounting policies used for segment reporting should be consistent with …
What accounting policies are used for segment reporting? Read More »
Impairment of an asset occurs when the carrying amount of an asset on the balance sheet exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and its value in use. Impairment indicates that the asset’s value has declined significantly and may not be recoverable in …
What is impairment of an asset? How is it treated in a accounting? Read More »
Accounting conventions are standards, customs or guidelines associated with the practical application of accounting principles, and are aimed at bringing about consistency in the maintenance of accounts. Accounting conventions are generally accepted principles and are not considered legally binding. Here are some common accounting conventions along with examples: Conservatism Convention: This convention suggests that accountants …
Cash equivalents are highly liquid short-term investments that are readily convertible into known amounts of cash and have a very short maturity period, typically three months or less from the date of acquisition. They are considered to be highly secure and easily marketable, allowing companies to maintain liquidity and meet short-term cash needs. The technical …
The effective tax rate (ETR) is a financial metric that represents the average rate at which a company’s pre-tax profits are taxed. It provides insight into the company’s overall tax liability as a percentage of its taxable income. The effective tax rate takes into account various tax incentives, deductions, credits, and other factors that impact …
Securities Transaction Tax (STT) is a type of tax levied by the Indian government on the purchase or sale of securities such as stocks, mutual funds, and futures and options contracts traded on recognized stock exchanges in India. The tax is collected by the stock exchanges and helps to fund the government’s social welfare programs. …
Financial risk management is the process of identifying, assessing, and managing various types of financial risks that a company may face in its operations. Financial risks can arise from a variety of sources such as market fluctuations, credit risks, liquidity risks, interest rate risks, currency risks, and commodity price risks. Effective financial risk management involves …
NIFTY and SENSEX are stock market indices in India. NIFTY represents the National Stock Exchange of India’s 50 largest companies by market capitalization, while SENSEX represents the Bombay Stock Exchange’s 30 largest and most actively traded companies. They are used as barometers to measure the overall performance of the Indian stock market and provide investors …
The differences between EBIT and EBITDA: 1.EBIT stands for Earnings Before Interest and Taxes, while EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. 2.EBIT is calculated by subtracting the company’s operating expenses from its revenue, while EBITDA is calculated by adding back depreciation and amortization expenses to EBIT. 3.EBIT represents the amount of …
What is difference between EBIT and EBITDA? Can EBIT be greater than EBITDA? Read More »
The inventory turnover ratio is a financial metric that shows how efficiently a company is managing its inventory. It measures the number of times a company sells and replaces its inventory during a given period, typically one year. The ratio is calculated by dividing the cost of goods sold by the average inventory for the …
The process involves the following steps: 1.Identify the subsidiaries to be included in the consolidation and gather their financial statements. 2.Adjust the subsidiary financial statements to conform to the accounting policies of the parent company, such as depreciation methods, inventory valuation, and revenue recognition. 3.Eliminate any intercompany transactions and balances between the parent and subsidiary …
How to consolidate a subsidiary while preparing consolidated financial statement? Read More »
To make a reconciliation statement, follow these general steps: Identify the items to be reconciled: Determine the two sets of data or accounts that need to be reconciled. For example, it could be bank statements, intercompany balances, or accounts receivable/payable. Gather the relevant data: Collect the necessary information, such as the balances or transactions for …
The first step of taking a loan is to assess the need for borrowing and determine the amount needed. This involves evaluating the purpose of the loan and identifying the specific financial requirements to achieve the intended goal. Once the amount needed has been determined, the borrower should assess their ability to repay the loan, …
Currency swap is a financial contract between two parties to exchange principal and interest payments denominated in two different currencies. In a currency swap, each party borrows and lends in a different currency. The purpose of a currency swap is to manage currency risk and reduce the cost of borrowing in a foreign currency. Interest …
The classification of deferred tax liability as current or non-current depends on the timing of the reversal of the underlying temporary differences that gave rise to the deferred tax liability. If the underlying temporary differences are expected to reverse within 12 months from the end of the reporting period, then the deferred tax liability is …
Deferred tax liability is current or non current in nature? Read More »
Ind AS 103 defines control as the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Examples of control include: 1.Ownership of more than 50% of voting rights: When an entity owns more than 50% of the voting rights in another entity, it is presumed …
How control has been defined under Ind As 103. Explain by giving examples? Read More »
Yes, LLP (Limited Liability Partnership) can be a subsidiary under Ind AS, provided that it meets the definition of a subsidiary as per Ind AS 110. Ind AS 110 defines a subsidiary as an entity that is controlled by another entity (the parent), which is a shareholder or group of shareholders who have the power …
Under Ind AS 23, borrowing costs that are directly attributable to the acquisition, construction, or production of a qualifying asset are required to be capitalized as part of the cost of that asset. A qualifying asset is an asset that takes a substantial period of time to get ready for its intended use or sale. …
Conditions for recognizing revenue over time: 1.The customer simultaneously receives and consumes the benefits of the seller’s performance. 2.The seller’s performance creates or enhances an asset that the customer controls. 3.The seller can measure the progress of the performance obligation towards completion. 4.The customer consumes the benefits of the seller’s performance as it is performed. …
As per Ind AS 115, Revenue from Contracts with Customers, volume-based discounts should be accounted for as variable consideration, which means that the discount should be estimated at the time of sale based on the expected volume of goods or services to be purchased by the customer. The expected discount amount should then be subtracted …
What is the treatment of volume based discount as per Ind As 115? Read More »
Ind AS 2, “Inventories,” provides guidance on the valuation of inventory in an entity’s financial statements. Inventory, also known as stock, refers to goods held by a company for the purpose of resale, production, or supply in the normal course of business. The standard outlines how to determine the cost of inventory and the subsequent …
Ind As 2 : How Inventory is valued as per Ind AS 2 ? Read More »
The concept of Component Accounting under Ind AS 16, “Property, Plant and Equipment,” allows entities to account for significant components of an item of property, plant, and equipment separately when those components have different useful lives. This approach recognizes that certain assets are made up of distinct parts or components that may have varying economic …
Ind AS 16, “Property, Plant and Equipment,” is an accounting standard that provides guidance on the recognition, measurement, depreciation, and disclosure of property, plant, and equipment in an entity’s financial statements. The “deemed cost exemption” is a provision in Ind AS 16 that allows entities to measure an item of property, plant, and equipment at …
Ind AS 16 : What is the Deemed cost exemption as per Ind AS 16 ? Read More »
To record a share-based payment transaction under IndAS 102 in your books: Determine Fair Value: Calculate the fair value of the equity instruments being granted at the grant date. This is usually done using valuation methods like the Black-Scholes model for options or other appropriate techniques. Recognize Expense: Recognize the fair value of the equity …
Commercial bank: accepts deposits from customers (retail depositors, commercial depositors etc. and makes consumer and commercial loans using these deposits. It may also offer anciliary services like credit cards Investment bank: acts as an intermediary between companies and investors. Does not accept deposits, but rather sells investments, advises on M&A, etc. Loans and debt/equity issues …
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The Cost of Equity is always higher than Cost of Debt. Note that we have used the word ALWAYS not USUALLY. This is because for any given company, equity will always be riskier than debt, and hence costlier. Risk is the main reason why equity is more expensive – the equity investor faces an uncertainty …
Working capital is the amount of a company’s current assets minus the amount of its current liabilities. The adequacy of a company’s working capital depends on the industry in which it operates, its relationship with its customers and suppliers, its inventory levels and more. Working Capital and Net Working Capital are usually interchangeable – Current …
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Profitability ratio: Profitability ratios measure a company’s ability to generate profits from its operations. 1.Gross Profit Margin = (Revenue – Cost of Goods Sold) / Revenue x 100% 2.Net Profit Margin = Net Profit / Revenue x 100% 3.Return on Equity = Net Income / Shareholders’ Equity x 100% Valuation ratio: Valuation ratios assess a …
Dividend models are used to estimate the value of a company’s stock based on its expected dividend payments. Two commonly used dividend models are the Dividend Discount Model (DDM) and the Gordon Growth Model (GGM). Dividend Discount Model (DDM): The DDM values a stock by discounting its expected future dividend payments to their present value. …
Location- New Delhi Roles and Responsibilities- Responsible for the credit appraisal and underwriting of self-employed customers. Assessment of risk and repaying capacity of the customer to ascertain the credit worthiness. Recommending the loan application for sanctioning post the credit appraisal process. Interacting with customers via telephone and visiting business setup to understand nature of business …
Job Role / Responsibilities Perform internal audits and process reviews for functions to assess the adequacy, effectiveness and efficiency of the established internal controls and procedures Lead and perform control design assessments; Lead walkthroughs, identifying controls in the processes/ functions/ products/services, etc. Identify key areas of risk within processes and propose appropriate controls …
Job Description About the role : In this role, you will be responsible for responsible to take lead in various projects in the Company and provide various accounting solutions in line with the applicable accounting standards and processes in the industry. You will also participate in the monthly and yearly closing of books and communicate …
