AS 21 : Consolidation : Previous year Tax expenses Treatment

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(Querist)
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07 December 2025 Hello Sir While preparing consolidated financial statement, there is previous financial year income tax expenses.

Now my Query is
1. should I deduct previous year tax expenses from consolidated profit to arrive at EPS. or should I adjust directly from reserve and surplus
2. Is Tax expenses do not comprises previous year tax expenses same as stand alone financial statement Schedule 3 Division 1?

Please share your view

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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08 December 2025 1. Should you deduct previous year tax expenses from consolidated profit for EPS?

✔ YES.
Report it as a prior period item through P&L — never adjust directly from reserves.

2. Does ‘Tax Expenses’ exclude previous year tax expenses like in standalone accounts?

✔ YES.
Prior period tax must be presented separately, not under current year tax.

NISHANT SIPANI

NISHANT SIPANI

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08 December 2025 Thank You Sir.. Now got clarity

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