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Sample Disclosure as per ICDS

Sample Disclosure for ICDS - Applicable for FY 2016-17

ICDS I - ACCOUNTING POLICIES

Check Points Points to be fed in 13(f)

Mercantile method of
accounting employed.
All signicant accounting Expenses and Income are
Financial
1. policies adopted by a accounted for on accrual
Statements
person. basis as per generally
accepted accounting
principles in India
principles in India

Any change in an
accounting policy which has
a material effect shall be
disclosed. The amount by
which any item is affected
by such change shall also
be disclosed to the extent
be disclosed to the extent
ascertainable. Where such
amount is not
ascertainable, wholly or in
part, the fact shall be
indicated. If a change is
made in the accounting
policies which has no 3CD - Clause 13 Applicable only if some
2.
material effect for the (b), (c) change is there
current previous year but
which is reasonably
expected to have a material
effect in later previous
years, the fact of such
change shall be
appropriately disclosed in
the previous year in which
the change is adopted and
also in the previous year in
which such change has
material effect for the rst
time.

ICDS II - VALUATION OF INVENTORIES

The accounting policies


As per Cost or NRV whichever
adopted in measuring
is lower on
inventories including the
cost formulae used. Where
Specic Identication
Standard Costing has been
3CD - Clause 14 method/Weighted Average/
1. used as a measurement of
(a) First In First Out valued as per
cost, details of such
cost, details of such
Standard Cost/Retail Method
inventories and a
conrmation of the fact that Inventory has been valued as
standard cost approximates per exclusive method however
the actual cost.

Total amount of inventory with


bifurcation

The total carrying amount Raw Material


of inventories and its WIP
2. 3CD Clause 35
classication appropriate to Finished Goods
a person. Spares

(Clause of nancial statement


may also be referred )

ICDS III - CONSTRUCTION CONTRACTS

Total Amount recognized


as contract revenue in
the current nancial year
The amount of is Rs XX,xxx
contract revenue Proportion of contract
recognised as revenue cost with respect to
in the period; and Management estimated contract cost
1.
1. in the period; and estimated contract cost
the methods used to certicate method/surveys of work
determine the stage of performed
completion of method/physical
contracts in progress. proportion method has
been used for calculation
of percentage of
completion

A person shall disclose the


following for contracts in
progress at the reporting
date, namely:

amount of costs Each contract

incurred and needs to be


2. recognized prots less looked upon. Amount to be shown

recognized losses up Advance as on

to the reporting date; BS to be reported

the amount of
advances received;
and
the amount of
retentions.

ICDS IV - REVENUE RECOGNITION

In a transaction involving
sale of good, total amount
not recognized as revenue Not Applicable/The Rs XX,xx
during the previous year due amount was not recognized
1. Scrutiny
to lack of reasonably due to lack of reasonable
certainty of its ultimate certainty
collection along with nature
collection along with nature
of uncertainty.

The amount of revenue Scrutiny


from service transactions
2. Amount to be shown
recognized as revenue Each contract

during the previous year. needs to be


looked upon.
Advance as on
Proportion of contract cost
BS to be reported
with respect to estimated
The method used to contract cost method/surveys
determine the stage of of work performed
3.
completion of service method/physical proportion
transactions in progress. method has been used for
calculation of percentage of
completion

For service transactions in


progress at the end of
previous year

amount of costs
incurred and
recognized prots less
4. recognized losses
upto end of previous
year;
the amount of
advances received;
and
the amount of
retentions.

ICDS V - TANGIBLE FIXED ASSETS

Description of asset or 3CD - Clause 18 As per clause 18 of Tax audit


1.
block of assets report

2. Rate of depreciation

Actual cost or written down


3.
value, as the case may be

Additions or deductions
during the year with dates;
in the case of any addition
of an asset, date put to use;
including adjustments on
account of -
Central Value Added
4. Tax credit claimed and
allowed under the
CENVAT Credit Rules,
2004;
change in rate of
exchange of currency;
subsidy or grant or
reimbursement, by
whatever name called

5. Depreciation allowable

Written down value at the


6.
end of year

ICDS VII - GOVERNMENT GRANTS

Nature and extent of


Government grants
recognized during the Particulars Amount
previous year by way of
1. deduction from the actual Scrutiny
Total
cost of the asset or assets
amount of
or from the written down
or from the written down
Grants
value of block of assets
during the previous year.
For FA -
recognized
Nature and extent of
as deduction
Government grants As per Prot &
2. from FA
recognized during the Loss Account
previous year as income.
For FA - not
recognized
Nature and extent of
as deduction
Government grants not
from FA
recognized during the
MRL, Fixed asset
previous year by way of
register/schedule
3. deduction from the actual Other than
and grants
cost of the asset or assets FA
received
or from the written down recognized
value of block of assets and as income
reasons thereof.

Other than
Nature and extent of FA not
Government grants not MRL & check recognized
4. recognized during the grants received as income
previous year as income from nancial
and reasons thereof.

ICDS IX - BORROWING COSTS

In case of specic
borrowing, actual

The accounting policy borrowing cost has been

1. adopted for borrowing Scrutiny capitalized on that asset


costs. In case of general
borrowing, borrowing
cost is being capitalized
as per Para 6 of ICDS IX.

The amount of borrowing


2. costs capitalized during the Financials Amount needs to be disclosed
previous year.

ICDS X - PROVISIONS, CONTINGENT ASSETS AND CONTINGENT LIABILITIES

1. A brief description of the


Particulars
nature of the obligation.
(with Amount
description)
The carrying amount at the
beginning and end of the
previous year. Opening
Balance of
Additional provisions made provisions
during the previous year,
including increases to
Add:
existing provisions.
Provision
Amounts used, that is Made during
incurred and charged the year
against the provision, during

the previous year.


Less:
Amount
Unused amounts reversed
charges
during the previous year.
against
provision
Less :

The amount of any Amount

expected reimbursement, reversed

stating the amount of any during


6.
asset that has been previous

recognised for that years

expected reimbursement.

Closing
balance

Particulars
Following disclosure shall
(with Amount
be made in respect of each
description)
class of asset and related
income recognised as
provided in para 11, namely: Opening
Balance
Balance

a brief description of
the nature of the asset Add: amount

and related income; added during

the carrying amount of the year

asset at the beginning


and end of the
7. Less: Income
previous year;
received
additional amount of
against asset
asset and related
income recognised
during the year, Less :

including increases to Amount

assets and related reversed

income already during

recognised; and previous


years
amount of asset and
related income
reversed during the Closing
previous year. balance

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Notes in case Income is being taxed on accrual basis irrespective of fact ICDS guides
otherwise. For e.g. retention money, Interest on accrual etc.

Taxpayer has adopted a position that retention money/interest income on non-performing


asset /xxxx is not to be recognized as revenue since it does not become due to the
taxpayer in absence of accrual conditions as per Section 5 being met. Reliance has been
placed on judicial precedents like E.D. Sassoon & Co. Ltd. v CIT (1954) 26 ITR 27 (SC), CIT
v Excel Industries Limited (2013) 358 ITR 295 (SC) and XXXXx. Accordingly, the total
taxable income does not include the amount of said retention money/interest income on
non-performing asset.

If any clause is not applicable, rather than leaving it blank. 'Not applicable' should be
written.

Appropriate management representation letter should be obtained from assessee.


Disclosures needs to be suitable modied as per specic requirements.

The author can also be reached at namanshrimal@jainshrimal.com

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