As 9

This query is : Resolved

Richa Sharma (Querist)
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22 May 2012 If suppose we have invested in mutual funds which is a BALANCED FUND on 1st April 2011... And the maturity of mutual fund is 5th April 2012 and we are getting returns also on that corresponding day...
So we will recognize Dividend on Investment on 5th April only as per AS9
BUT suppose if we know that since it is a balanced fund(equity+debt) Can we recognize the interest on the debt part of the investment on accrual basis at the Risk free market rate?????
Please suggest.
Very very urgent

Sanjay Chauhan (IFRS)

Sanjay Chauhan (IFRS) (Expert)
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23 May 2012 There is a difference between Interest income and dividend income.

Interest is accrued over the period but Dividend only when right to receive is established.

Hence in case of Mutual funds, the right to receive the return in the form of dividend is established on the day when it is declared. If it is daily then daily, or monthly then monthly.

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Richa Sharma

Richa Sharma (Querist)
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24 May 2012 That means interest part can be taken on accrual basis and dividend as and when received..
Thanks for the explanation sir!!!

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