Accounting of shares received under right issue as per IND AS

You will record it as 30. Just use as

Investment a/c 25

To bank a/c 25

and once it is fully paid

Investment a/c 5

To Bank a/c 5

you don't have to specify things because you are not issuing. No matter how many calls, it is your investment which is growing. 

Thank You for your prompt response.

Ind AS says initial recognition of financial assets should be at fair value, which in this case its Rs.50

So my entry will be:

Investment A/c  dr 50

     To bank                  25

      To payable              5

       To OCI reserves    20 (measured through FVTOCI)

These can be classified as equity instruments if it is business combinations where value changes is recorded in OCI. When you dispose them at the same price what will happen? 

Bank a/c 50

To Investment a/c 50

then why would someone recognise a loss like this:

Loss on sale of investment a/c 20

To OCI 20

It's against tax laws to claim for something which we never had.

If we recognised it like this, imagine completely paid up

Investment a/c 30

By Bank a/c 30

and revalue it like 

Investment a/c 20

To OCI a/c

and when you dispose it, 

Bank a/c 30

To Investment a/c 30

To Revaluation loss a/c 20 

By OCI a/c 20???? 

thing is the same. Next if we go through OCI classifications, Loss and gain from revaluation will be recorded here only, leaving no tax consequences. Your correct to elect this option! I would otherwise as the standard states gives permission to do my way ie., first recognise at cost and revalue. 

***By Investment a/c 30

To Bank a/c 30

 

Will you please give me Ind AS reference of "Your correct to elect this option! I would otherwise as the standard states gives permission to do my way ie., first recognise at cost and revalue." as I am unable to find it.

I am not much into tax, but I am sure OCI kind of gain is routed through Deffreed Tax Liability as I am acquiring it lesser than its fair value.

Read more at: https://www.caclubindia.com/forum/accounting-of-shares-received-under-right-issue-as-per-ind-as-581741.asp?offset=1

derecognition of financial assets principle suits my disposal criteria in Indas. Remember in the absence of any principle, we can use the existing principles, to derecognise OCI surplus. 

Investment a/c 50

To bank a/c 30

To OCI 20

upon derecognition

Revaluation write off a/c 20

Bank 30

To Investment a/c 50.

Subsequently measured at FVOCI, not at initial recognition. Fair value is the transaction price 30. 

an entity shall classify financial assets as subsequently measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss on the basis of both: 261 (a) the entity’s business model for managing the financial assets and (b) the contractual cash flow characteristics of the financial asset.

A financial asset shall be measured at fair value through other comprehensive income if both of the following conditions are met: (a) the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. (See Ind AS 113, Fair Value Measurement.)

Despite paragraphs 4.1.1–4.1.4, an entity may, at initial recognition, irrevocably designate a financial asset as measured at fair value through profit or loss if doing so eliminates or significantly reduces a measurement or recognition inconsistency (sometimes referred to as an ‘accounting mismatch’) that would otherwise arise from measuring assets or liabilities or recognising the gains and losses on them on different bases (see paragraphs B4.1.29–B4.1.32).

at initial recognition, an entity shall measure a financial asset or financial liability at its fair value plus or minus, in the case of a financial asset or financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability