Ind AS 103, Business Combination provides guidance on accounting for business combinations under the acquisition method. Business combinations are transactions or events in which a reporting entity (acquirer) obtains control of one or more businesses (the acquiree). The date of acquisition is the date on which acquirer obtains control of the acquiree. Ind AS 103 provides an acquirer a time frame, referred to as the ‘measurement period’, after the acquisition date to finalise its initial accounting of the business combination. An acquirer in a business combination is required to report provisional amounts when the measurements are incomplete at the end of the reporting period covering the business combination. This edition of Accounting and Auditing Update (AAU) includes an article to discuss the key aspects of the measurement period in a business combination. It discusses the use of provisional amounts, the accounting implications of adjustments made within this period, and the required disclosures in such situations.
The IFRS Sustainability Disclosure Standards IFRS S1, General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2, Climate-related Disclosures issued by the International Sustainability Standards Board (ISSB) form the global baseline for sustainability-related disclosures. The standards require companies to provide a complete and balanced explanation of sustainability-related risks and opportunities. Companies disclose material information about the sustainability-related risks and opportunities that could reasonably be expected to affect an entity’s cash flows, its access to finance or its cost of capital over the short, medium, or long term. To support the implementation of IFRS Sustainability Disclosure Standards, in November 2024, the ISSB issued an education material ‘Sustainability-related risks and opportunities and the disclosure of material information’. The educational material provides guidance to help identify and disclose material information about sustainability-related risks and opportunities that are likely to affect an entity’s prospects. The article on this topic summarises the education material and discusses guidance related to identification and disclosure of material information.
As always, we have included a regular round-up of recent regulatory updates in India and internationally.
We would be delighted to receive feedback and suggestions from you on the topics we should cover in forthcoming editions of AAU.
For more information on this update, please write to aaupdate@kpmg.com.
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