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receipt of that information in the same way as non -adjusting events after the reporting period in accordance
with Ind AS 10, Events after the Reporting Period.
The entity shall not reflect that new information in its opening Ind AS Balance Sheet (unless the estimates

need adjustment for any differences in accounting policies or there is objective evidence that the estimates
were in error). Instead, the entity shall reflect that new information in profit or loss (or, if appropriate, other
comprehensive income) for the year ended 31 March 2019.

Note 7: Government Grant:

Ind AS 20 states that the benefit of a government loan at a below-market rate of interest is treated as a
government grant. The loan shall be recognised as measured in accordance with Ind AS 109, Financial
Instruments. The benefit of the below-market rate of interest shall be measured as the difference between
the initial carrying value of the loan determined in accordance with Ind AS 109, and the proceeds received. The
benefit is accounted for in accordance with this Standard.

However, Ind AS 101 states, a first-time adopter shall classify all government loans received as a financial
liability or an equity instrument in accordance with Ind AS 32, Financial Instruments: Presentation. Except as
permitted, a first-time adopter shall apply the requirements in Ind AS 109, Financial Instruments, and Ind AS
20, Accounting for Government Grants and Disclosure of Government Assistance, prospectively to government
loans existing at the date of transition to Ind ASs and shall not recognise the corresponding benefit of the
government loan at a below-market rate of interest as a government grant. Consequently, if a first -time

adopter did not, under its previous GAAP, recognise and measure a government loan at a below-market rate of
interest on a basis consistent with Ind AS requirements, it shall use its previous GAAP carrying amount of the
loan at the date of transition to Ind AS as the carrying amount of the loan in the opening Ind AS Balance
Sheet. An entity shall apply Ind AS 109 to the measurement of such loans after the date of transition to Ind

AS.

Note 8: Dividend
Dividend should be deducted from retained earnings during the year when it has been declared and approved.
Accordingly, the provision declared for preceding year should be reversed (to rectify the wrong entry). Retained
earnings would increase proportionately due to such adjustment.

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