In recent years, the accounting treatment of commodity contracts - especially those related to electricity - have gained considerable importance. This shift is driven by the changing dynamics of energy markets and the growing focus on renewable energy trading. As more companies enter into long-term power purchase agreements (PPAs) to support sustainability initiatives or engage in energy trading, the application of Ind AS 109, Financial Instruments, to these contracts has become a key area of discussion. Such commodity contracts involving electricity, present unique challenges in financial reporting under Ind AS 109. This edition of the Accounting and Auditing Update (AAU) features an article that illustrates the application of Ind AS 109 to commodity contracts through a detailed example of a PPA.
Timely publication of annual financial results is more than a compliance exercise - it reflects efforts to enhance transparency, preparedness of entities, and its investor responsiveness. This edition of the AAU includes an article on the trends in publication of annual results by the top 200 listed companies by market capitalisation on the NSE, for recent financial years. The article discusses emerging sectoral trends, reporting behaviour shifts, along with a comparison with those of the annual results reporting timelines of companies observed in a couple of developed economies.
As always, we have included a digest of recent regulatory updates in India and internationally.
We would be delighted to receive feedback/suggestions from you on the topics we should cover in the forthcoming editions of AAU.
For more information on this update, please write to aaupdate@kpmg.com.
