Go AD-Free with CAclubindia Pro and get a FREE CCI Coffee Mug. Subscribe Now!

AS-5

C.A. LINESH PATIL (CA) (910 Points)

17 January 2011

whether profit or loss from sale of assets is extra ordinary item under AS-5 or not.

Thanks

Reply
Follow
Share

7 Replies

Ayyswariya RG (Knowledge Seeker) (3711 Points)
Replied 17 January 2011

Yes, It is an extra ordinary item

Upgrade to CAclubindia Pro. Subscribe Now!

C.A. LINESH PATIL (CA) (910 Points)
Replied 17 January 2011

but AS-5 issued by iCAI contains an example which include sale of assets under ordinary activity. i think this would be consider as incidental activity to furtherance of business .you may also check this in M.P.Vijay kumar book of AS

Thanks

Ayyswariya RG (Knowledge Seeker) (3711 Points)
Replied 17 January 2011

Yes Exactly. A Sale activity undertaken is incidental and therefore comes under Ordinary Activities.

Sonam Bidasaria (CA) (770 Points)
Replied 17 January 2011

Profit or loss from sale of asset is not an extra-ordinary activity. Sale of asset is an incidental activity. It is true that this is not extra-ordinary item but still the disclosure regarding the profit/ loss on sale of assets is required in accordance with Para 12 of AS-15, which reads as under:

"When items of income and expense within profit or loss from

ordinary activities are of such size, nature or incidence that their

disclosure is relevant to explain the performance of the enterprise for

the period, the nature and amount of such items should be disclosed

separately."