S1: Under Ind AS 19, actuarial gains and losses on defined benefit plans are recognized in Other Comprehensive Income (OCI). S2: These actuarial gains and losses recognized in OCI are subsequently reclassified to the Profit and Loss account in future periods. Which statement(s) is/are correct? MCQ with Answer and Explanation
S1: Under Ind AS 19, actuarial gains and losses on defined benefit plans are recognized in Other Comprehensive Income (OCI). S2: These actuarial gains and losses recognized in OCI are subsequently reclassified to the Profit and Loss account in future periods. Which statement(s) is/are correct?
A. S2 only
B. Neither S1 nor S2
C. S1 only
D. Both S1 and S2
Answer: Option C
Solution (By JKSSB Mock Tests)
Ind AS 19 requires remeasurements (actuarial gains/losses) of defined benefit plans to be recognized in OCI. S2 is incorrect because these amounts are recognized directly in retained earnings and are NOT reclassified (recycled) to P&L in subsequent periods.
Explanation:
The primary objective of a financial audit is to express an independent opinion on whether the financial statements present a true and fair view.
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