Ø Dividends are classified as a financial liability and are reported in the income statement as an expense. If dividends are declared subsequent to the balance sheet date, it is not recognised as liability. (IFRS)
Ø Dividends are reflected in the financial statements of the year to which they relate even if proposed after the year end. (Indian GAAP)
v Share Issue Expenses
Ø In Indian GAAP may be accounted as deferred expenses and amortized.
Ø Has to be charged off immediately to P & L. (IFRS)
v Investment and marketable securities
Ø Only unrealized losses on available for sale securities is recognized in the income statement.
Ø Option to recognize gain/ (losses) in AFS either through Income statement or equity. (IFRS)
Ø Negative Goodwill (i.e, the excess of the fair value of the net assets acquired over the aggregate purchase consideration)
Ø Negative goodwill that relates to expectation of future losses and expenses should be recognized as income when the future losses and expenses are recognized. Where it does not relate to identifiable future losses and expenses, an amount not exceeding the fair values of the acquired identifiable non – monetary assets should be recognized as income. (IFRS)
Ø Negative goodwill is credited to the capital reserve account. (Indian GAAP)
v Prior period adjustments
Ø Separately disclosed in the current statement of P & L together with their nature and amount.
Ø If the error is significant, is corrected by adjusting the opening retained earnings. (IFRS)