Exposure Draft
Limited
revisions to Accounting Standard 20: Earnings per Share
The following is
the Exposure Draft of the limited revisions to Accounting Standard (AS) 20, Earnings
Per Share. The limited revisions are proposed primarily to address the
conceptual lacuna in arriving at earnings for computing EPS. Section 78 of the
Companies Act, 1956 allows various adjustments in the securities premium
account, which are inconsistent with the Accounting Standards. For example,
adjustment s of preliminary expenses against securities premium is not in
accordance with AS 26, Intangible Assets. Also, adjustments are made against
securities premium and other reserves under various Court Schemes which are in
deviation from the Accounting Standards. The proposed amendment will ensure
that earnings are computed in accordance with Accounting Standards for EPS
purposes.
The Board
invites comments on any aspect of this Exposure Draft. Comments are most helpful
if they contain a clear rationale and, where applicable, provide a suggestion
for alternative wording.
Comments should
be submitted in writing to the Secretary, Accounting Standards Board, The
Institute of Chartered Accountants of India, ICAI Bhawan, Post Box No. 7100, Indraprastha
Marg, New Delhi – 110 002, so as to be received not later than – May 10, 2013.
Comments can also be sent by e -mail at edcommentsasb@icai.org or asb@icai.org or asb@icai.in.
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Paragraph
11 is amended. New text is underlined.
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11.
For the purpose of calculating basic earnings per share, the net profit or loss
for the period attributable to equity shareholders should be the net profit or
loss for the period after
(i)
deducting preference dividends and any attributable tax thereto for the period;
and
(ii)
adjusting the amount in respect of an item of income or expense which is
debited or credited to share premium account/reserves, that is otherwise required
to be recognised in the statement of profit and loss in accordance with
Accounting Standards.
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