Based on the job description provided, here are some potential interview questions along

with guidance on how you might approach answering them:

Technical and Experience-Based Questions

1. Can you describe your experience with financial accounting and reporting for
Indian entities?
o Approach: Highlight your experience in preparing financial statements,
managing general ledger, compliance with Indian regulations, and ensuring
accuracy in financial reporting.
2. How have you handled month-end closing processes in your previous roles?
o Approach: Discuss your experience with tasks like journal voucher (JV)
postings, reconciliations, accruals, and adjustments. Emphasize any
improvements or efficiencies you have implemented.
3. What is your experience with preparing P&L statements and Balance Sheets?
o Approach: Provide specific examples of your work on P&L and Balance
Sheet preparation, including any challenges you faced and how you
resolved them. Mention your attention to detail and accuracy in financial
reporting.
4. Can you explain how you've managed related party transactions reporting?
o Approach: Discuss your understanding of related party transaction
regulations and the importance of transparency. Share examples of how
you identified, documented, and reported such transactions in compliance
with regulatory requirements.
5. Describe your experience with cash flow management and working on notes to
accounts.
o Approach: Detail your role in managing cash flow, including forecasting,
monitoring cash positions, and ensuring liquidity. Mention your work on
drafting notes to accounts and ensuring clarity and compliance in
disclosures.
6. How familiar are you with IGAAP and IndAS? Can you share an experience where
you had to apply these standards?
o Approach: Highlight your understanding of both Indian GAAP and IndAS.
Discuss specific instances where you applied these standards, particularly in
transitioning or reconciling financial statements.

Behavioral and Situational Questions

7. Tell us about a time when you identified an error in financial reporting. How did
you handle it?
o Approach: Share a specific example, focusing on how you identified the
error, the steps you took to rectify it, and the measures you implemented to
prevent similar errors in the future.
 8. How do you prioritize tasks during busy periods, such as month-end or year-end
closing?
o Approach: Discuss your time management and organizational skills.
Provide examples of how you prioritize tasks, delegate responsibilities, and
ensure deadlines are met.
9. Have you ever faced a challenge in implementing new accounting standards or
regulations? How did you overcome it?
o Approach: Describe the challenge, your approach to understanding and
applying the new standards, and the outcome. Emphasize your adaptability
and willingness to stay updated with industry changes.
10. How do you ensure compliance with regulatory and company policies in your
financial reporting?
o Approach: Highlight your knowledge of relevant regulations and your
methodical approach to ensuring compliance. Mention any internal
controls or audits you've been involved in.

Soft Skills and Cultural Fit

11. How do you communicate complex financial information to non-financial

stakeholders?
o Approach: Discuss your ability to simplify complex financial data and
present it in a clear, understandable manner. Share examples of how you've
effectively communicated with other departments or senior management.
12. Describe a situation where you had to work closely with a team to complete a
project. What was your role and how did you contribute?
o Approach: Focus on teamwork, collaboration, and your specific
contributions to the project. Highlight your ability to work well with
others and achieve common goals.

Preparation Tips

 Research the Company: Understand the business model of Reliance Retail Limited
and its client RCPL. Be aware of the industry trends and challenges.
 Know the Standards: Brush up on IGAAP and IndAS standards, as well as any
recent updates or changes.
 Prepare Examples: Have specific examples ready to illustrate your experience and
achievements, particularly those that align with the job requirements.

Good luck with your interview preparation! If you need further assistance, feel free to
ask.

4o
provide some interview questions and answers based on above topics
ChatGPT
Here are some potential interview questions and model answers based on the provided
job description for the Assistant Manager - Finance and Accounting position at Reliance
Retail Limited:

1. Experience with Financial Accounting and Reporting for Indian Entities

Question: Can you describe your experience with financial accounting and reporting for
Indian entities?

Answer:
"In my previous role at [Previous Company], I was responsible for managing the financial
accounting and reporting for the Indian subsidiary. This involved maintaining accurate
records of all financial transactions, preparing financial statements in compliance with
Indian accounting standards, and ensuring all statutory requirements were met. I handled
the preparation and presentation of the financial statements, including the P&L, Balance
Sheet, and Cash Flow statements. Additionally, I collaborated with external auditors to
ensure timely and accurate completion of audits. My focus was on accuracy, compliance,
and providing insightful financial analysis to support management decision-making."

2. Month-End Closing Processes

Question: How have you handled month-end closing processes in your previous roles?

Answer:
"During the month-end closing process, I was responsible for overseeing the entire
process from start to finish. This included reviewing and posting journal vouchers,
reconciling bank and other accounts, and ensuring all necessary accruals and adjustments
were accurately recorded. I implemented a checklist system to streamline the process,
which helped reduce the time taken to close the books by 20%. Additionally, I conducted
variance analysis to compare actual results with forecasts, identifying key drivers for any
discrepancies and providing actionable insights to management."

3. Preparation of P&L and Balance Sheet

Question: What is your experience with preparing P&L statements and Balance Sheets?

Answer:
"I have extensive experience in preparing both P&L statements and Balance Sheets. In my
previous role, I was responsible for compiling these financial statements on a monthly,
quarterly, and annual basis. I ensured that all entries were accurate and adhered to
accounting standards, which was crucial for internal and external reporting. I also
performed a detailed analysis of the P&L to highlight key performance indicators, such as
gross margin and net profit. For the Balance Sheet, I focused on accurate asset and
liability classification and ensured that all balances were reconciled."
4. Related Party Transactions Reporting

Question: Can you explain how you've managed related party transactions reporting?

Answer:
"Related party transactions require careful documentation and transparency. In my
previous roles, I ensured that all such transactions were identified, documented, and
disclosed in accordance with regulatory requirements. This involved working closely
with legal and compliance teams to ensure proper documentation and approvals were in
place. I also prepared detailed reports that were included in the financial statements,
ensuring all necessary disclosures were made. My approach always emphasized
transparency and adherence to regulatory guidelines to avoid any conflicts of interest or
compliance issues."

5. Cash Flow Management and Notes to Accounts

Question: Describe your experience with cash flow management and working on notes to
accounts.

Answer:
"Cash flow management has been a critical part of my role. I regularly monitored cash
positions, forecasted future cash flows, and worked closely with the treasury team to
ensure optimal liquidity management. I developed a comprehensive cash flow model that
helped in planning for various scenarios and making informed decisions. For notes to
accounts, I ensured that all necessary disclosures were made in accordance with
accounting standards. This included providing detailed explanations of significant
accounting policies, contingent liabilities, and other relevant information. My focus was
on providing clear and comprehensive information to stakeholders."

6. IGAAP and IndAS Experience

Question: How familiar are you with IGAAP and IndAS? Can you share an experience
where you had to apply these standards?

Answer:
"I am well-versed in both IGAAP and IndAS, having worked on financial reporting
transitions from IGAAP to IndAS. One notable experience was during the transition
period where we had to restate the previous year’s financials to align with IndAS. This
involved a thorough review of all financial statements, identifying the key differences
between the two standards, and adjusting our accounting policies accordingly. For
example, we had to reclassify certain financial instruments and reassess revenue
recognition policies. This process required extensive coordination with the auditors and
training the finance team on the new standards. The successful implementation not only
ensured compliance but also provided more meaningful insights into our financial
performance."

7. Identifying and Handling Errors in Financial Reporting

Question: Tell us about a time when you identified an error in financial reporting. How
did you handle it?

Answer:
"In one instance, I discovered an inconsistency in the revenue recognition process during
an internal review. A portion of revenue had been recognized prematurely due to a
misunderstanding of the contractual terms. I immediately flagged the issue to my
supervisor and worked with the accounting team to investigate the cause. We corrected
the entries, restated the affected financial statements, and implemented a more robust
review process to prevent future occurrences. This experience underscored the
importance of vigilance and adherence to accounting principles, and it reinforced my
commitment to accuracy and integrity in financial reporting."

8. Prioritizing Tasks During Busy Periods

Question: How do you prioritize tasks during busy periods, such as month-end or year-
end closing?

Answer:
"During busy periods like month-end or year-end closing, I prioritize tasks by creating a
detailed checklist and timeline for all required activities. I start with critical tasks, such as
closing the general ledger and ensuring all major accounts are reconciled. I also prioritize
tasks based on deadlines, such as statutory filings or internal reporting requirements.
Effective communication with the team is crucial; I assign tasks based on each member's
strengths and workload, ensuring that we work efficiently and meet all deadlines.
Additionally, I monitor the progress closely and am prepared to reallocate resources or
adjust priorities if unexpected issues arise."

9. Communicating Complex Financial Information

Question: How do you communicate complex financial information to non-financial

stakeholders?

Answer:
"I focus on simplifying complex financial information by using clear, concise language
and avoiding technical jargon. I often use visual aids, such as charts and graphs, to
illustrate key points and trends, making the data more accessible. For example, when
presenting financial results to the marketing team, I highlight how certain financial
metrics, like revenue growth or cost savings, impact their budgets and strategic plans. I
also encourage questions and discussions, ensuring that everyone has a clear
understanding of the financial information and its implications. This approach helps build
trust and ensures that non-financial stakeholders can make informed decisions based on
the financial data presented."

These model answers provide a structured and comprehensive way to respond to

potential interview questions. Tailor these responses to your specific experiences and
achievements to make them more authentic and impactful. Good luck with your
interview!

4o
indi as applicable for these type of companies and reporting requirements as per indi as
ChatGPT

IndAS (Indian Accounting Standards) are converged standards with the International
Financial Reporting Standards (IFRS). They are applicable to various types of companies
in India, including listed companies, unlisted companies with a net worth above a
specified threshold, and certain other companies as notified by the Ministry of Corporate
Affairs (MCA). Here's an overview of IndAS applicability and reporting requirements:

Applicability of IndAS

1. Mandatory Adoption:
o Listed Companies: All companies listed on any stock exchange in India or
outside.
o Unlisted Companies:
 Having a net worth of ₹250 crore or more (as per the last audited
financial statements).
2. Voluntary Adoption:
o Companies not covered under the mandatory criteria may voluntarily
adopt IndAS, but once adopted, they cannot switch back to previous
accounting standards.
3. Other Entities:
o Holding, subsidiary, joint venture, or associate companies of companies
covered above.

Key Reporting Requirements under IndAS

1. Financial Statements:
o Balance Sheet: A complete statement of the financial position, showing
assets, liabilities, and equity.
o Statement of Profit and Loss: Includes revenue, expenses, profit or loss,
other comprehensive income, and total comprehensive income.
 o Statement of Changes in Equity: Details changes in equity during the
reporting period, including comprehensive income, transactions with
owners, and equity adjustments.
o Statement of Cash Flows: Provides information about cash inflows and
outflows from operating, investing, and financing activities.
2. Disclosure Requirements:
o Significant Accounting Policies: Disclosures related to the significant
accounting policies adopted in preparing the financial statements.
o Notes to Accounts: Detailed information and explanations regarding items
presented in the financial statements, such as contingencies, commitments,
related party transactions, and more.
o Segment Reporting: If applicable, disclosures related to the different
segments in which the company operates, including segment revenue,
segment profit or loss, and segment assets and liabilities.
o Related Party Disclosures: Details of transactions with related parties,
including the nature of the relationship, the amount involved, and the
outstanding balances.
o Earnings Per Share (EPS): Disclosure of basic and diluted earnings per
share, including the calculations used.
3. Compliance and Presentation:
o Companies must ensure that their financial statements present a true and
fair view of their financial position and performance, comply with all
applicable IndAS standards, and provide sufficient disclosures to enable
users to understand the financial statements.
o Consistency in the presentation and classification of items in the financial
statements from one period to the next is required unless a change is
necessary for a better presentation.
4. Transition to IndAS:
o Companies transitioning to IndAS for the first time must restate their
comparative financial information as per IndAS and prepare an opening
balance sheet at the date of transition.
o Specific guidance and exemptions are provided under IndAS 101 for first-
time adoption.

Importance of IndAS Compliance

 Transparency and Comparability: IndAS aims to enhance transparency and

comparability of financial statements by aligning with global standards.
 Investor Confidence: Improved financial reporting quality helps build investor
confidence.
 Global Reach: Companies that adhere to IndAS can attract international
investments more easily due to the alignment with IFRS.
For companies like Reliance Retail Limited and its client RCPL, adherence to IndAS is
essential for accurate financial reporting, compliance with regulatory requirements, and
providing stakeholders with reliable financial information.

4o
provide indi as standards applicable for these typecompanies
ChatGPT

For companies like Reliance Retail Limited and RCPL, which operate as large entities in
India, a comprehensive set of Indian Accounting Standards (IndAS) is applicable. Below is
a list of key IndAS standards that are generally relevant to companies in the retail and
broader business sectors, covering various aspects of financial reporting:

Key IndAS Standards

1. IndAS 1 - Presentation of Financial Statements: Provides guidelines on the

presentation of financial statements, including the overall requirements for their
structure and minimum content.
2. IndAS 2 - Inventories: Prescribes the accounting treatment for inventories,
including the determination of cost and subsequent recognition as an expense.
3. IndAS 7 - Statement of Cash Flows: Requires the provision of information about
historical changes in cash and cash equivalents.
4. IndAS 8 - Accounting Policies, Changes in Accounting Estimates, and Errors:
Specifies criteria for selecting and changing accounting policies, and how to deal
with changes in estimates and correction of errors.
5. IndAS 10 - Events after the Reporting Period: Deals with the accounting for and
disclosure of events that occur after the balance sheet date.
6. IndAS 12 - Income Taxes: Covers the accounting treatment of current and
deferred tax.
7. IndAS 16 - Property, Plant, and Equipment: Prescribes the accounting treatment
for tangible fixed assets.
8. IndAS 18 - Revenue (superseded by IndAS 115): Was concerned with revenue
recognition from ordinary activities. It has been replaced by IndAS 115.
9. IndAS 19 - Employee Benefits: Deals with all forms of employee compensation and
benefits.
10. IndAS 21 - The Effects of Changes in Foreign Exchange Rates: Provides guidance
on accounting for transactions and balances in foreign currencies.
11. IndAS 23 - Borrowing Costs: Specifies the accounting treatment for borrowing
costs.
12. IndAS 24 - Related Party Disclosures: Requires disclosures of transactions and
balances with related parties.
13. IndAS 32 - Financial Instruments: Presentation: Provides guidance on the
presentation of financial instruments.
 14. IndAS 36 - Impairment of Assets: Prescribes the procedures to ensure that assets
are carried at no more than their recoverable amount.
15. IndAS 37 - Provisions, Contingent Liabilities, and Contingent Assets: Covers the
recognition and measurement of provisions, contingent liabilities, and contingent
assets.
16. IndAS 38 - Intangible Assets: Deals with the accounting treatment for intangible
assets.
17. IndAS 40 - Investment Property: Applies to the accounting for investment
property.
18. IndAS 105 - Non-Current Assets Held for Sale and Discontinued Operations: Sets
out the accounting and disclosure requirements for assets held for sale and
discontinued operations.
19. IndAS 107 - Financial Instruments: Disclosures: Provides guidance on disclosures
related to financial instruments.
20. IndAS 109 - Financial Instruments: Deals with the recognition, classification,
measurement, and derecognition of financial instruments.
21. IndAS 110 - Consolidated Financial Statements: Outlines the requirements for
preparing consolidated financial statements.
22. IndAS 115 - Revenue from Contracts with Customers: Provides a single,
comprehensive model for revenue recognition arising from contracts with
customers, superseding IndAS 18 and IndAS 11.
23. IndAS 116 - Leases: Specifies the accounting treatment for lease transactions,
requiring lessees to recognize assets and liabilities for most leases.
24. IndAS 34 - Interim Financial Reporting: Prescribes the minimum content of an
interim financial report and the recognition and measurement principles.
25. IndAS 33 - Earnings Per Share: Provides guidance on the calculation and
presentation of earnings per share.

Specific Considerations for Retail Companies

For a company like Reliance Retail Limited, certain standards may have particular
importance:

 IndAS 2: Due to significant inventories, proper accounting and valuation of

inventory are critical.
 IndAS 115: Given the nature of retail operations, revenue recognition practices are
crucial, especially regarding the timing and amount of revenue recognized.
 IndAS 16 and 36: With a potentially large number of physical assets, impairment
assessments and proper accounting for property, plant, and equipment are
necessary.
 IndAS 116: Leases are common in retail for stores and warehouses, making lease
accounting critical.
These IndAS standards ensure comprehensive and transparent financial reporting,
aligning with international best practices. For specific cases or additional standards
applicable, consultation with accounting professionals or the latest regulatory updates is
recommended.

IndAS 24 is an accounting standard that prescribes the disclosure requirements for related
party relationships, transactions, and outstanding balances, including commitments. The
primary objective of IndAS 24 is to ensure that financial statements contain the necessary
disclosures to draw attention to the possibility that the financial position and profit or loss
of an entity may have been affected by the existence of related parties and by transactions
and outstanding balances, including commitments, with such parties.

Key Elements of IndAS 24:

1. Related Party Definition:

o A related party is a person or entity that is related to the reporting entity,
including:
 Persons with control or significant influence over the entity.
 Key management personnel, including directors and their close family
members.
 Entities under common control or significant influence with the reporting
entity.
 Post-employment benefit plans for the benefit of employees of the
reporting entity or its related parties.
2. Disclosure Requirements:
o Relationships: Disclose the nature of the relationship where control exists,
irrespective of whether there have been transactions between the related parties.
o Transactions: Disclose the nature and amount of transactions, including sales,
purchases, transfers, leasing arrangements, and other significant transactions.
o Outstanding Balances: Disclose the amount and nature of outstanding balances,
including commitments, at the reporting date, and the terms and conditions of the
transactions, such as pricing policies, settlement terms, and guarantees.
o Compensation: Disclose the compensation of key management personnel in total
and by category, including short-term benefits, post-employment benefits, other
long-term benefits, termination benefits, and share-based payments.
3. Materiality and Aggregation:
o Disclosures should be made separately for each category of related parties and
should be sufficiently detailed to allow users to understand the potential impact
on the financial statements.
4. Exemptions:
o Related party transactions and outstanding balances are exempt from disclosure
requirements in consolidated financial statements if they are eliminated on
consolidation.

Interview Questions and Answers Related to IndAS 2: Inventories

Question 1: What are the primary measurement bases for inventories under IndAS 2?

Answer:
"Under IndAS 2, inventories are measured at the lower of cost and net realizable value
(NRV). The cost of inventories includes all costs of purchase, costs of conversion, and
other costs incurred in bringing the inventories to their present location and condition.
The net realizable value is the estimated selling price in the ordinary course of business,
less the estimated costs of completion and the estimated costs necessary to make the sale."

Question 2: Can you explain the difference between the FIFO and weighted average cost
methods for inventory valuation?

Answer:
"The FIFO (First-In, First-Out) method assumes that the earliest goods purchased are the
first to be sold, so the inventory remaining at the end of the period is valued at the most
recent costs. This method is useful in times of rising prices as it shows lower costs of
goods sold and higher ending inventory value.

The weighted average cost method calculates the cost of inventory based on the weighted
average cost of goods available for sale during the period. This average cost is used to
determine the cost of goods sold and the ending inventory value. The weighted average
method smooths out price fluctuations over time."

Question 3: What is net realizable value (NRV), and why is it important in inventory
valuation?

Answer:
"Net realizable value (NRV) is the estimated selling price in the ordinary course of
business, minus the estimated costs of completion and the estimated costs necessary to
make the sale. It is an important concept in inventory valuation because it ensures that
inventories are not carried at a value higher than the amount expected to be realized from
their sale. This conservatism principle helps prevent overstatement of assets and income
in the financial statements."

Question 4: How are inventory write-downs accounted for under IndAS 2?

Answer:
"Inventory write-downs to NRV are recognized as an expense in the period in which the
write-down occurs. If there is a subsequent increase in NRV, the amount of the previous
write-down can be reversed, but only to the extent of the original write-down. The
reversal is recognized as a reduction in the inventory expense in the period in which it
occurs."

Question 5: What costs are excluded from the cost of inventories as per IndAS 2?

Answer:
"Costs excluded from the cost of inventories include abnormal amounts of wasted
materials, labor, or other production costs, storage costs (unless necessary in the
production process before a further production stage), administrative overheads that do
not contribute to bringing inventories to their present location and condition, and selling
costs. These costs are expensed in the period they are incurred."

These questions and answers should help you demonstrate a strong understanding of
IndAS 2 during an interview, showcasing your knowledge of inventory measurement,
valuation, and accounting principles.

1. Understanding of Related Party

Question: Can you explain who qualifies as a related party under IndAS 24?

Answer:
"Under IndAS 24, a related party is defined as a person or entity that is related to the
reporting entity. A person or close member of that person's family is related if they:

 Have control or joint control over the reporting entity.

 Have significant influence over the reporting entity.
 Are a member of the key management personnel of the reporting entity or its parent.

An entity is related to a reporting entity if it:

 Is a member of the same group (i.e., subsidiaries, associates, joint ventures).

 Is a post-employment benefit plan for the benefit of employees of the reporting entity or
an entity related to the reporting entity.
 Is controlled or jointly controlled by a person identified above.
 Provides key management personnel services to the reporting entity or the parent of the
reporting entity."

2. Disclosure Requirements

Question: What are the key disclosure requirements under IndAS 24 for related party
transactions?
Answer:
"IndAS 24 requires the disclosure of:

 The nature of the related party relationship.

 The amount of transactions, including sales, purchases, loans, or other financial
arrangements, and outstanding balances, including commitments.
 The terms and conditions, including whether they are on arm's length basis or not.
 The provisions for doubtful debts related to the amount of outstanding balances.
 The expense recognized during the period for bad or doubtful debts due from related
parties.
 The details of key management personnel compensation, categorized into short-term
employee benefits, post-employment benefits, other long-term benefits, termination
benefits, and share-based payment."

3. Materiality and Aggregation

Question: How does IndAS 24 address materiality and aggregation in the disclosure of
related party transactions?

Answer:
"IndAS 24 requires entities to disclose information that is necessary for users to
understand the potential impact of related party relationships on the financial statements.
The standard allows for the aggregation of similar transactions and balances with related
parties by type, unless separate disclosure is necessary for understanding the effects of the
related party transactions on the financial statements. Materiality plays a key role in
determining the level of detail to be disclosed, ensuring that immaterial transactions do
not clutter the financial statements while material transactions are clearly
communicated."

4. Significance of Related Party Disclosures

Question: Why are related party disclosures important for stakeholders?

Answer:
"Related party disclosures are critical because they highlight transactions and
relationships that might not occur at arm's length. This information is essential for
stakeholders as it helps them assess the risks and potential benefits associated with these
transactions. For example, transactions with related parties could be used to manipulate
financial results or transfer assets and liabilities in a way that benefits one party over
another. Transparent disclosure helps in maintaining trust and ensures that the financial
statements provide a true and fair view of the entity's financial position and
performance."

5. Examples of Related Party Transactions

Question: Can you provide examples of transactions that might be considered related
party transactions?

Answer:
"Examples of related party transactions include:

 Sale or purchase of goods and services between the reporting entity and a related entity.
 Loans and guarantees provided by or to a related party.
 Lease agreements between related parties.
 Transfer of research and development services.
 Management contracts between the reporting entity and key management personnel.
 Provision of administrative services or support functions by one group company to
another."

6. Key Management Personnel Compensation

Question: What are the components of key management personnel compensation that
need to be disclosed under IndAS 24?

Answer:
"Under IndAS 24, the compensation of key management personnel must be disclosed,
typically categorized into:

 Short-term employee benefits: Salaries, wages, bonuses, and non-monetary benefits such
as medical care, housing, and cars.
 Post-employment benefits: Pensions, other retirement benefits, post-employment life
insurance, and post-employment medical care.
 Other long-term benefits: Long-term service leave or sabbatical leave, jubilee or other
long-service benefits, long-term disability benefits, and deferred compensation.
 Termination benefits: Severance payments.
 Share-based payment: Equity and equity-linked instruments provided to key management
personnel."

7. Exemptions and Exceptions

Question: Are there any exemptions to the related party disclosures required by IndAS
24?

Answer:
"Yes, IndAS 24 provides certain exemptions:

 Transactions and balances between a government and entities controlled, jointly

controlled, or significantly influenced by the same government are exempt from detailed
disclosures. Instead, a general disclosure about the nature of the government's relationship
and the types of transactions involved is sufficient.
  Disclosures are not required in the financial statements of a parent company regarding
intra-group related party transactions that are eliminated on consolidation. However,
such disclosures may be necessary in the separate financial statements of subsidiaries."

These questions and answers are designed to test and demonstrate a comprehensive
understanding of IndAS 24, focusing on key concepts, requirements, and practical
applications in financial reporting. Tailor your answers to reflect your specific experience
and understanding of the standard.

IndAS 1: Presentation of Financial Statements

Explanation: IndAS 1 sets out the overall requirements for the presentation of financial
statements, guidelines for their structure, and the minimum requirements for their
content. The standard aims to ensure comparability both with the entity's financial
statements of previous periods and with the financial statements of other entities.

Key aspects include:

 Complete Set of Financial Statements: Includes the balance sheet, statement of profit and
loss, statement of changes in equity, statement of cash flows, and notes.
 Fair Presentation and Compliance: Financial statements must present fairly the financial
position, financial performance, and cash flows.
 Accrual Basis of Accounting: Except for cash flow information, the accrual basis of
accounting should be used.
 Materiality and Aggregation: Items must be presented separately if they are material.
 Offsetting: Assets and liabilities, or income and expenses, should not be offset unless
required or permitted by an IndAS.
 Comparative Information: Requires the presentation of comparative information for all
amounts reported in the current period's financial statements.

Interview Questions and Answers:

Question 1: What is the purpose of IndAS 1 in financial reporting?

Answer:
"IndAS 1 ensures that financial statements provide a fair presentation of the financial
position, financial performance, and cash flows of an entity. It establishes guidelines for
the form and content of financial statements, ensuring consistency and comparability
over time and across different entities."
Question 2: Can you explain the importance of the 'fair presentation' requirement in
IndAS 1?
Answer:
"Fair presentation requires that financial statements reflect the true economic substance
of transactions and events, not merely their legal form. This includes presenting
information in a manner that is understandable and faithfully represents the financial
position, performance, and cash flows of the entity, providing a neutral and complete
view."

IndAS 7: Statement of Cash Flows

Explanation: IndAS 7 requires the presentation of information about historical changes in

cash and cash equivalents through a statement of cash flows, which classifies cash flows
during the period into operating, investing, and financing activities.

Key aspects include:

 Operating Activities: The principal revenue-producing activities of the entity.

 Investing Activities: The acquisition and disposal of long-term assets and other
investments not included in cash equivalents.
 Financing Activities: Changes in the size and composition of the contributed equity and
borrowings of the entity.

Interview Questions and Answers:

Question 1: What are the three main categories of cash flows under IndAS 7?
Answer:
"Under IndAS 7, cash flows are categorized into operating, investing, and financing
activities. Operating activities relate to the principal revenue-producing activities,
investing activities involve the acquisition and disposal of long-term assets, and financing
activities pertain to changes in equity and borrowings."

Question 2: Why is the statement of cash flows important for financial analysis?
Answer:
"The statement of cash flows provides insight into the cash-generating ability of an entity
and its ability to pay debts and dividends. It helps stakeholders understand how an entity
generates cash, uses it, and manages its liquidity, which is crucial for assessing financial
health."

IndAS 8: Accounting Policies, Changes in Accounting Estimates, and Errors

Explanation: IndAS 8 prescribes the criteria for selecting and changing accounting
policies, along with the accounting treatment and disclosure of changes in accounting
policies, changes in accounting estimates, and corrections of errors.
Key aspects include:

 Accounting Policies: The specific principles, bases, conventions, rules, and practices
applied by an entity in preparing and presenting financial statements.
 Changes in Accounting Estimates: Adjustments of the carrying amount of an asset or a
liability, or related expense, resulting from new information or developments.
 Errors: Omissions and misstatements in financial statements due to mathematical
mistakes, mistakes in applying accounting policies, or oversight of facts.

Interview Questions and Answers:

Question 1: How should a company account for a change in accounting policy under
IndAS 8?
Answer:
"A change in accounting policy should be applied retrospectively, adjusting the opening
balances of assets, liabilities, and equity for the earliest period presented as if the new
policy had always been applied. However, this is only required if it is practicable to
determine the period-specific effects."

Question 2: What is the difference between a change in accounting estimate and a

correction of an error?
Answer:
"A change in accounting estimate results from new information or developments that
affect the carrying amount of an asset or liability, recognized prospectively. In contrast, a
correction of an error involves rectifying a misstatement from prior periods, which is
accounted for retrospectively."

IndAS 12: Income Taxes

Explanation: IndAS 12 prescribes the accounting treatment for income taxes, including
current tax and deferred tax. It outlines the recognition and measurement of current tax
liabilities or assets and the recognition of deferred tax liabilities or assets.

Key aspects include:

 Current Tax: The amount of income taxes payable or recoverable in respect of the taxable
profit or loss for the period.
 Deferred Tax: Arises from temporary differences between the carrying amount of an asset
or liability in the balance sheet and its tax base.
 Temporary Differences: Differences between the carrying amount of assets and liabilities
for financial reporting purposes and their respective tax bases.

Interview Questions and Answers:

Question 1: What is the difference between current tax and deferred tax?
Answer:
"Current tax refers to the income taxes payable or recoverable for the current period,
while deferred tax arises from temporary differences between the accounting carrying
amounts of assets and liabilities and their tax bases, leading to future tax consequences."

Question 2: How is a deferred tax liability recognized under IndAS 12?

Answer:
"A deferred tax liability is recognized for all taxable temporary differences, except when
the liability arises from the initial recognition of goodwill or an asset or liability in a
transaction that is not a business combination and affects neither accounting profit nor
taxable profit at the time of the transaction."

IndAS 16: Property, Plant, and Equipment

Explanation: IndAS 16 prescribes the accounting treatment for property, plant, and
equipment (PPE). It covers the recognition of assets, determination of their carrying
amounts, and the depreciation charges and impairment losses to be recognized in relation
to them.

Key aspects include:

 Recognition Criteria: PPE should be recognized as an asset when it is probable that future
economic benefits associated with the item will flow to the entity and the cost can be
measured reliably.
 Measurement: Initially measured at cost, subsequently carried at cost less accumulated
depreciation and impairment losses, or at revalued amounts.
 Depreciation: Systematically allocated over the useful life of the asset.

Interview Questions and Answers:

Question 1: What is the cost model and the revaluation model under IndAS 16?
Answer:
"Under the cost model, an asset is carried at its cost less any accumulated depreciation and
impairment losses. Under the revaluation model, an asset is carried at a revalued amount,
being its fair value at the date of the revaluation, less any subsequent accumulated
depreciation and impairment losses."

Question 2: How should an entity determine the useful life of an asset?

Answer:
"The useful life of an asset should be determined based on the period over which the asset
is expected to be available for use, taking into account factors such as expected usage,
physical wear and tear, technical or commercial obsolescence, and legal or similar limits
on the use of the asset."

IndAS 18: Revenue (Superseded by IndAS 115)

Explanation: IndAS 18 (now largely replaced by IndAS 115) provided guidance on the
recognition of revenue from certain types of transactions, including sales of goods,
rendering of services, and use by others of the entity's assets yielding interest, royalties,
and dividends.

Key aspects included:

 Revenue Recognition: Revenue should be recognized when it is probable that economic

benefits will flow to the entity and the revenue can be reliably measured.

Interview Questions and Answers:

Question 1: When was revenue typically recognized under IndAS 18?

Answer:
"Revenue under IndAS 18 was recognized when the entity transferred the significant
risks and rewards of ownership of the goods to the buyer, or when the services were
rendered, and it was probable that the economic benefits associated with the transaction
would flow to the entity."

Question 2: Why was IndAS 18 replaced by IndAS 115?

Answer:
"IndAS 115 was introduced to provide a more comprehensive framework for revenue
recognition, addressing inconsistencies in previous standards and providing a five-step
model that applies to all contracts with customers, thereby improving comparability and
consistency."

IndAS 32: Financial Instruments: Presentation

Explanation: IndAS 32 deals with the presentation of financial instruments, including the
classification of such instruments into financial assets, financial liabilities, and equity
instruments. It also covers the presentation of interest, dividends, losses, and gains
relating to financial instruments.

Key aspects include:

 Distinction between Liabilities and Equity: Criteria for classifying an instrument as a

liability or an equity instrument.
 Offsetting: Financial assets and financial liabilities are offset, and the net amount reported
only when there is a legally enforceable right to set off the recognized amounts and an
intention to settle on a net basis.

Interview Questions and Answers:

Question 1: How does IndAS 32 distinguish between a financial liability and an equity
instrument?
Answer:
"A financial liability is any liability that represents a contractual obligation to deliver cash
or another financial asset. An equity instrument, on the other hand, represents a residual
interest in the assets of an entity after deducting all its liabilities. The key distinction is
based on the substance of the contractual arrangement, not merely the legal form."

Question 2: Under what conditions can financial assets and liabilities be offset?
Answer:
"Financial assets and liabilities can be offset if the entity currently has a legally
enforceable right to set off the recognized amounts and intends either to settle on a net
basis or to realize the asset and settle the liability simultaneously."

IndAS 33: Earnings per Share (EPS)

Explanation: IndAS 33 prescribes principles for the determination and presentation of

earnings per share (EPS), aiming to improve the comparability of performance across
different entities in the same reporting period and across different periods for the same
entity.

Key aspects include:

 Basic EPS: Calculated by dividing profit or loss attributable to ordinary equity holders by
the weighted average number of ordinary shares outstanding during the period.
 Diluted EPS: Reflects the potential dilution that could occur if securities or contracts to
issue ordinary shares were exercised or converted into ordinary shares.

Interview Questions and Answers:

Question 1: What is the difference between basic EPS and diluted EPS?
Answer:
"Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders
by the weighted average number of ordinary shares outstanding during the period.
Diluted EPS considers the potential dilution from convertible securities, options,
warrants, and other financial instruments, providing a measure of earnings per share as if
all dilutive potential ordinary shares were converted."

Question 2: Why is diluted EPS important for investors?

Answer:
"Diluted EPS is important because it provides a worst-case scenario for earnings per share
by accounting for the impact of all potential dilutive securities. This helps investors
understand the potential impact on EPS if all convertible securities were exercised,
providing a more comprehensive view of the company's earnings."

IndAS 36: Impairment of Assets

Explanation: IndAS 36 sets out the procedures that an entity applies to ensure that its
assets are carried at no more than their recoverable amount. An asset is impaired when its
carrying amount exceeds its recoverable amount.

Key aspects include:

 Recoverable Amount: The higher of an asset's fair value less costs to sell and its value in
use.
 Impairment Loss: Recognized when the carrying amount of an asset exceeds its
recoverable amount. The loss is charged to the profit and loss account.
 Cash-Generating Units (CGUs): The smallest identifiable group of assets that generates
cash inflows largely independent of the cash inflows from other assets or groups of assets.

Interview Questions and Answers:

Question 1: How is an impairment loss recognized and measured under IndAS 36?
Answer:
"An impairment loss is recognized when the carrying amount of an asset exceeds its
recoverable amount, which is the higher of the asset's fair value less costs to sell and its
value in use. The impairment loss is measured as the amount by which the carrying
amount exceeds the recoverable amount and is recognized immediately in profit or loss."

Question 2: What are the indicators of asset impairment?

Answer:
"Indicators of asset impairment include significant declines in the asset's market value,
adverse changes in the technological, market, economic, or legal environment, increases
in interest rates, and the obsolescence or physical damage of an asset. Internal indicators
could include evidence of obsolescence or physical damage, discontinuation of use, or
plans to dispose of the asset."

IndAS 37: Provisions, Contingent Liabilities, and Contingent Assets

Explanation: IndAS 37 deals with the accounting for provisions, contingent liabilities, and
contingent assets. It provides guidance on when and how provisions should be
recognized, measured, and disclosed.

Key aspects include:

 Provisions: Recognized when an entity has a present obligation as a result of a past event,
it is probable that an outflow of resources will be required to settle the obligation, and a
reliable estimate can be made of the amount.
 Contingent Liabilities: Not recognized in financial statements but disclosed unless the
possibility of an outflow of resources is remote.
 Contingent Assets: Not recognized in financial statements but disclosed when an inflow of
economic benefits is probable.
Interview Questions and Answers:

Question 1: When should a provision be recognized according to IndAS 37?

Answer:
"A provision should be recognized when there is a present obligation (legal or
constructive) as a result of a past event, it is probable that an outflow of resources
embodying economic benefits will be required to settle the obligation, and a reliable
estimate can be made of the amount of the obligation."

Question 2: What is the difference between a provision and a contingent liability?

Answer:
"A provision is a recognized liability of uncertain timing or amount, whereas a contingent
liability is a possible obligation that arises from past events and whose existence will be
confirmed only by the occurrence or non-occurrence of one or more uncertain future
events not wholly within the control of the entity. Contingent liabilities are not
recognized in the financial statements but are disclosed unless the outflow of resources is
remote."

IndAS 107: Financial Instruments: Disclosures

Explanation: IndAS 107 requires disclosures that enable users to evaluate the significance
of financial instruments for the entity's financial position and performance and the nature
and extent of risks arising from those financial instruments.

Key aspects include:

 Categories of Financial Instruments: Disclosures about the carrying amounts of financial

assets and liabilities categorized into different classes.
 Nature and Extent of Risks: Information about the exposure to risks, such as credit risk,
liquidity risk, and market risk, and how these risks are managed.

Interview Questions and Answers:

Question 1: What types of information are required to be disclosed under IndAS 107?
Answer:
"IndAS 107 requires entities to disclose information that enables users to evaluate the
significance of financial instruments for the entity's financial position and performance,
and the nature and extent of risks arising from financial instruments. This includes the
carrying amounts of each category of financial assets and liabilities, and a description of
risk management policies."

Question 2: Why is the disclosure of financial instrument risks important?

Answer:
"The disclosure of financial instrument risks is important as it provides transparency
regarding the entity's exposure to risks such as credit risk, liquidity risk, and market risk.
It helps stakeholders understand how these risks could impact the entity's financial
position and performance and how the entity manages these risks."

IndAS 109: Financial Instruments

Explanation: IndAS 109 outlines the principles for the recognition, classification,
measurement, and derecognition of financial assets and financial liabilities. It also covers
hedge accounting.

Key aspects include:

 Classification and Measurement: Financial assets are classified based on the entity's
business model for managing the financial assets and the contractual cash flow
characteristics. The categories include amortized cost, fair value through other
comprehensive income (FVOCI), and fair value through profit or loss (FVTPL).
 Impairment: A forward-looking expected credit loss (ECL) model is used for impairment.
 Hedge Accounting: Aligns accounting with risk management activities, providing more
useful information.

Interview Questions and Answers:

Question 1: What are the primary categories for classifying financial assets under IndAS
109?
Answer:
"Under IndAS 109, financial assets are classified into three primary categories: amortized
cost, fair value through other comprehensive income (FVOCI), and fair value through
profit or loss (FVTPL). The classification depends on the entity's business model for
managing the assets and the contractual cash flow characteristics of the financial assets."

Question 2: How is impairment of financial assets determined under IndAS 109?

Answer:
"Impairment of financial assets is determined using the expected credit loss (ECL) model,
which requires recognition of credit losses based on an expectation of future credit losses,
rather than waiting for a default to occur. This model considers all reasonable and
supportable information, including forward-looking data."

IndAS 110: Consolidated Financial Statements

Explanation: IndAS 110 establishes the principles for the preparation and presentation of
consolidated financial statements when an entity controls one or more other entities.

Key aspects include:

 Control: An investor controls an investee when it has the power to direct the relevant
activities, exposure or rights to variable returns, and the ability to use its power to affect
the returns.
  Consolidation: All entities controlled by the parent are consolidated, with the parent and
its subsidiaries presenting a single set of financial statements.

Interview Questions and Answers:

Question 1: What criteria must be met for an investor to control an investee under IndAS
110?
Answer:
"Under IndAS 110, an investor controls an investee when it has power over the investee,
exposure or rights to variable returns from its involvement with the investee, and the
ability to use its power to affect those returns. Control is assessed by considering
substantive rights, the relevant activities that significantly affect returns, and the
investor's ability to direct those activities."

Question 2: How should a parent entity account for its subsidiaries in its consolidated
financial statements?
Answer:
"A parent entity should consolidate its subsidiaries by combining like items of assets,
liabilities, equity, income, expenses, and cash flows. Intragroup balances, transactions,
income, and expenses should be eliminated in full. Non-controlling interests should be
presented in the consolidated balance sheet within equity, separately from the equity of
the owners of the parent."

IndAS 115: Revenue from Contracts with Customers

Explanation: IndAS 115 provides a comprehensive framework for recognizing revenue

from contracts with customers. It outlines a five-step model for revenue recognition:

1. Identify the contract(s) with a customer.

2. Identify the performance obligations in the contract.
3. Determine the transaction price.
4. Allocate the transaction price to the performance obligations.
5. Recognize revenue when (or as) the entity satisfies a performance obligation.

Interview Questions and Answers:

Question 1: What is the five-step model for revenue recognition under IndAS 115?
Answer:
"The five-step model under IndAS 115 includes: 1) identifying the contract with a
customer, 2) identifying the performance obligations in the contract, 3) determining the
transaction price, 4) allocating the transaction price to the performance obligations, and
5) recognizing revenue when (or as) the entity satisfies a performance obligation."

Question 2: How should an entity recognize revenue for performance obligations satisfied
over time?
Answer:
"For performance obligations satisfied over time, revenue should be recognized by
measuring progress towards complete satisfaction of the performance obligation. This can
be done using either the output method (e.g., milestones reached) or the input method
(e.g., costs incurred), depending on which method best depicts the transfer of control of
goods or services to the customer."

IndAS 116: Leases

Explanation: IndAS 116 provides a comprehensive model for the identification of lease
arrangements and their treatment in the financial statements. It requires lessees to
recognize assets and liabilities for most leases.

Key aspects include:

 Right-of-Use Asset and Lease Liability: Lessees recognize a right-of-use asset and a lease
liability for all leases, except short-term leases and leases of low-value assets.
 Lease Term and Payments: The lease term includes the non-cancellable period of the lease,
together with periods covered by options to extend or terminate the lease if the lessee is
reasonably certain to exercise these options.

Interview Questions and Answers:

Question 1: What is a 'right-of-use' asset under IndAS 116?

Answer:
"A 'right-of-use' asset is an asset that represents a lessee's right to use an underlying asset
for the lease term. Under IndAS 116, lessees recognize a right-of-use asset and a
corresponding lease liability for most leases, reflecting the obligation to make lease
payments."

Question 2: How is a lease liability initially measured under IndAS 116?

Answer:
"A lease liability is initially measured at the present value of the lease payments not paid
at the commencement date. Lease payments include fixed payments, variable payments
that depend on an index or rate, amounts expected to be payable under residual value
guarantees, and the exercise price of a purchase option if the lessee is reasonably certain
to exercise that option."

These explanations and interview questions and answers will provide a comprehensive
understanding of the key IndAS standards relevant to financial reporting and compliance
in India.