AS - 2
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
06 May 2010
Can v apply AS 2 for Valuation of Shares held as Inventory ?
Aditya Maheshwari
(Expert)
06 May 2010
AS - 2
This Standard should be applied in accounting for inventories other than:
1. work in progress arising under construction contracts, including directly related service contracts [see Accounting Standard (AS) 7, Construction Contracts];
2. work in progress arising in the ordinary course of business of service providers;
3. shares, debentures and other financial instruments held as stock-in-trade
Though it is not applicable in practical life all valuations are done as per method suggested in AS - 2.
This Standard should be applied in accounting for inventories other than:
1. work in progress arising under construction contracts, including directly related service contracts [see Accounting Standard (AS) 7, Construction Contracts];
2. work in progress arising in the ordinary course of business of service providers;
3. shares, debentures and other financial instruments held as stock-in-trade
Though it is not applicable in practical life all valuations are done as per method suggested in AS - 2.
06 May 2010
For valuation of share As-13 is applied.
Aditya Maheshwari
(Expert)
06 May 2010
Dear Bansal
Shares, debentures and other securities held as stock-in-trade (i.e., for sale in the ordinary course of business) are not 'investments' as defined in this Standard. However, the manner in which they are accounted for and disclosed in the financial statements is quite similar to that applicable in respect of current investments. Accordingly, the provisions of this Standard, to the extent that they relate to current investments, are also applicable to shares, debentures and other securities held as stock-in-trade, with suitable modifications as specified in this Standard which is equivalent to method specified AS-2.
Shares, debentures and other securities held as stock-in-trade (i.e., for sale in the ordinary course of business) are not 'investments' as defined in this Standard. However, the manner in which they are accounted for and disclosed in the financial statements is quite similar to that applicable in respect of current investments. Accordingly, the provisions of this Standard, to the extent that they relate to current investments, are also applicable to shares, debentures and other securities held as stock-in-trade, with suitable modifications as specified in this Standard which is equivalent to method specified AS-2.
06 May 2010
THANKS SIR
06 May 2010
yes you can do it as per AS-2, but normally its not done in practical life...
Aditya Maheshwari
(Expert)
06 May 2010
Dear Shivang
Could you share then how its done in practical life?
Could you share then how its done in practical life?
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