Accounting standard

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Querist : Anonymous (Querist)

03 July 2012 is AS2 applicable to construction contracts if not how closing W.I.P is valued ?

Rajesh Dubey

Rajesh Dubey (Expert)
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03 July 2012 As per AS-2, This Standard should be applied in accounting for inventories other
than:
(a) work in progress arising under construction contracts,
including directly related service contracts (see Accounting
Standard (AS) 7, Construction Contracts);
(b) work in progress arising in the ordinary course of business of
service providers;
(c) shares, debentures and other financial instruments held as
stock-in-trade; and
(d) producers’ inventories of livestock, agricultural and forest
products, and mineral oils, ores and gases to the extent that
they are measured at net realisable value in accordance with
well established practices in those industries.