Mind The GAAP5: Financial Instruments (2)

Last week on Mind The GAAP we discussed the new Indian Accounting Standard on Financial Instruments. Corporate fundraising will now have to account for substance over form. For instance, equity shares with a put option will be accounted for as debt. The same applies to redeemable preference shares whereas compulsorily convertible debentures will counted towards debt. We also discussed fair valuing equity investments, a reality check for intra-group loans and guarantees and the impact of the expected loss model on doubtful debts. This week, Menaka Doshi of CNBC TV18 continues the conversation on financial instruments, especially derivate and hedge accounting, non-traditional instruments, de-recognition of financial instruments with Jamil Khatri, Head - Audit, KPMG, Sandip Khetan, Partner, EY and Member, ICAI Committee on IND-AS and Sumit Seth, Partner & IFRS Leader, PW gives his take on the accounting changes to Share Based Payments, including ESOPs.