Economics · Corporate Accounting
Consider the following standard corporate accounting statements regarding presentation under Schedule III and Ind AS: Statement 1: The preparation of Consolidated Financial Statements is a statutory requirement for companies with subsidiaries, combining financials line-by-line while adjusting for intra-group transactions. Statement 2: Cash Flow Statements allow both Direct and Indirect methods for operating activities, with the Indirect method being more commonly implemented. Statement 3: Deferred Tax Assets and Liabilities represent future tax consequences of temporary differences and are classified strictly as non-current in the balance sheet. Statement 4: Non-Controlling Interest represents equity in a subsidiary not attributable to the parent and must be presented separately from the parent shareholders' equity. Which of the options accurately evaluates the status of Statement 3 and Statement 4?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
- 1Both Statement 3 and Statement 4 are fundamentally incorrect under Indian Accounting Standards (Ind AS).
- 2Statement 4 is incorrect because non-controlling interest must be grouped inside the parent's equity share capital.
- 3Statement 3 and Statement 4 are both correct and accurately reflect the presentation and classification guidelines.✓
- 4Statement 3 is incorrect because deferred taxes are classified as current based on their expected reversal timeline.
Correct answer
Statement 3 and Statement 4 are both correct and accurately reflect the presentation and classification guidelines.
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