X - Provisions, contingent liabilities and contingent assets (w.e.f. AY 2017-18)

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....n the provisions of the Income-tax Act, 1961 ('the Act') and this Income Computation and Disclosure Standard, the provisions of the Act shall prevail to that extent. Scope 1. This Income Computation and Disclosure Standard deals with provisions, contingent liabilities and contingent assets, except those: (a)   resulting from financial instruments; (b)   resulting from executory contracts; (c)   arising in insurance business from contracts with policyholders; and (d)   covered by another Income Computation and Disclosure Standard. 2. This Income Computation and Disclosure Standard does not deal with the recognition of revenue which is dealt with by Inc....

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....he obligation; or (B)   a reliable estimate of the amount of the obligation cannot be made. (e)   "Contingent asset" is a possible asset that arises from past events the existence of which will be confirmed only by the occurrence or nonoccurrence of one or more uncertain future events not wholly within the control of the person. (f)   "Executory contracts" are contracts under which neither party has performed any of its obligations or both parties have partially performed their obligations to an equal extent. (g)   "Present obligation" is an obligation if, based on the evidence available, its existence at the end of the previous year is considered reasonably certain. 4(2) Word....

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.... the change occurs. Measurement Best Estimate 12. The amount recognised as a provision shall be the best estimate of the expenditure required to settle the present obligation at the end of the previous year. The amount of a provision shall not be discounted to its present value. 13. The amount recognised as asset and related income shall be the best estimate of the value of economic benefit arising at the end of the previous year. The amount and related income shall not be discounted to its present value. Reimbursements 14. Where some or all of the expenditure required to settle a provision is expected to be reimbursed by another party, the reimbursement shall be recognised when it is re....

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....ons of this standard after taking into account the amount recognised, if any, for the same for any previous year ending on or before 31st day of March,2016. Disclosure 21(1) Following disclosure shall be made in respect of each class of provision, namely:- (a)   a brief description of the nature of the obligation; (b)   the carrying amount at the beginning and end of the previous year; (c)   additional provisions made during the previous year, including increases to existing provisions; (d)   amounts used, that is incurred and charged against the provision, during the previous year; (e)   unused amounts reversed during the previous year; and (f) &n....