Indian Accounting Standards Questions and Answers

Q: Accounting Standard-16 is related with ............

Accounting Standard 16 relates to borrowing cost.AS 16, Borrowing Costs, issued by the Institute of Chartered Accountants of India, deals with interest and other costs incurred in borrowing funds. It requires borrowing costs directly attributable to acquiring, constructing or producing a qualifying asset, one that takes a substantial period to get ready for use, to be capitalised as part of its cost, and other borrowing costs to be charged as an expense.The other subjects have their own standards: segment reporting is AS 17, accounting for amalgamations is AS 14, and depreciation accounting was AS 6 (now merged into AS 10 on property, plant and equipment).

Q: Employee benefits to employees in financial statements are recognised as per ........................ .

Employee benefits are recognised as per Ind AS 19.Ind AS 19, Employee Benefits, prescribes the accounting and disclosure for short-term benefits, post-employment benefits such as gratuity and pension, other long-term benefits and termination benefits.Ind AS 1 deals with the presentation of financial statements. The other numbers offered do not concern employee benefits, so Ind AS 19 is the only fit.

Q: AS-15 deals with :

AS-15 deals with employee benefits.Accounting Standard 15 prescribes the accounting and disclosure of employee benefits: short-term benefits, post-employment benefits such as gratuity and pension, other long-term benefits and termination benefits. Its Ind AS counterpart is Ind AS 19.Leases are covered by AS-19, construction contracts by AS-7, and impairment of assets by AS-28.

Q: AS-26 deals with .................

AS-26 deals with intangible assets.Accounting Standard 26 sets out the recognition, measurement and amortisation of intangible assets, such as patents, copyrights, software, licences and brands, including research and development costs. Its Ind AS equivalent is Ind AS 38.Earnings per share is AS-20, employee benefits AS-15, and borrowing costs AS-16.

____________ prescribes the accounting principles for first-time adoption of Ind AS.

A.Ind As 101
B.Ind AS 102
C.Ind AS 103
D.Ind AS 104

Exam Year(s)

DSSSB - 2023,

Answer: A

Ind AS 101 prescribes the accounting principles for first-time adoption of Ind AS (First-time Adoption of Indian Accounting Standards). Ind AS 102 deals with share-based payment, Ind AS 103 with business combinations and Ind AS 104 with insurance contracts. Only the standard numbered 101 is the one for the first-time adopter.

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Accounting Standard-16 is related with ............

A.Segment reporting
B.Amalgamation
C.Borrowing cost
D.Depreciation accounting

Exam Year(s)

MH SET - 2018, SET Exam - 2018,

Answer: C

Accounting Standard 16 relates to borrowing cost.

AS 16, Borrowing Costs, issued by the Institute of Chartered Accountants of India, deals with interest and other costs incurred in borrowing funds. It requires borrowing costs directly attributable to acquiring, constructing or producing a qualifying asset, one that takes a substantial period to get ready for use, to be capitalised as part of its cost, and other borrowing costs to be charged as an expense.

The other subjects have their own standards: segment reporting is AS 17, accounting for amalgamations is AS 14, and depreciation accounting was AS 6 (now merged into AS 10 on property, plant and equipment).

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Employee benefits to employees in financial statements are recognised as per ........................ .

A.Indian AS-1
B.Indian AS-9
C.Indian AS-6
D.Indian AS-19

Exam Year(s)

MH SET - 2019, SET Exam - 2019,

Answer: D

Employee benefits are recognised as per Ind AS 19.

Ind AS 19, Employee Benefits, prescribes the accounting and disclosure for short-term benefits, post-employment benefits such as gratuity and pension, other long-term benefits and termination benefits.

Ind AS 1 deals with the presentation of financial statements. The other numbers offered do not concern employee benefits, so Ind AS 19 is the only fit.

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AS-15 deals with :

A.Employee benefits
B.Lease
C.Construction contract
D.Impairment of assets

Exam Year(s)

MH SET - 2024, SET Exam - 2024,

Answer: A

AS-15 deals with employee benefits.

Accounting Standard 15 prescribes the accounting and disclosure of employee benefits: short-term benefits, post-employment benefits such as gratuity and pension, other long-term benefits and termination benefits. Its Ind AS counterpart is Ind AS 19.

Leases are covered by AS-19, construction contracts by AS-7, and impairment of assets by AS-28.

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AS-26 deals with .................

A.Earning per share
B.Employee benefits
C.Borrowing cost
D.Intangible Assets

Exam Year(s)

MH SET - 2025, SET Exam - 2025,

Answer: D

AS-26 deals with intangible assets.

Accounting Standard 26 sets out the recognition, measurement and amortisation of intangible assets, such as patents, copyrights, software, licences and brands, including research and development costs. Its Ind AS equivalent is Ind AS 38.

Earnings per share is AS-20, employee benefits AS-15, and borrowing costs AS-16.

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The main objective of Accounting Standards is

A.To prepare the accounting reports which is easily understood by common man.
B.To comply with the legal formalities.
C.To harmonise the diversified accounting practices.
D.To comply with the requirements of the International Accounting Standards (IAS).

Exam Year(s)

UGC NET - 2012,

Answer: C

The main objective of accounting standards is to harmonise the diversified accounting practices. Before standards existed, firms could choose among many policies for similar transactions, which made statements of different companies hard to compare. Standards narrow these alternatives and bring uniformity.

Making reports easy for the common person to understand is a by-product, not the main aim. Complying with legal formalities is a function of the Companies Act, and matching the International Accounting Standards is a matter of convergence policy, not the basic purpose of a standard.

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In India, which of the following is prepared on the guidelines of AS-3 (Accounting Standard - 3) ?

A.Balance Sheet of a Company
B.Funds Flow Statement
C.Cash Flow Statement
D.Consolidated Financial Statement

Exam Year(s)

UGC NET - 2012,

Answer: C

In India the Cash Flow Statement is prepared on the guidelines of AS-3, the Accounting Standard on cash flow statements issued by the Institute of Chartered Accountants of India. The standard requires cash flows to be classified into operating, investing and financing activities. The balance sheet of a company is governed by Schedule VI of the Companies Act, and the funds flow statement is not governed by AS-3, since it explains changes in working capital and not in cash. Consolidated financial statements are dealt with in a different accounting standard. So option C is right.

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Indian Accounting Standards Questions and Answers

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Indian Accounting Standards Questions and Answers

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