ITFG explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
This digest covers the remaining ITFG answers that do not sit with a larger standard: government grants and duty exemptions, functional and presentation currency, related party disclosures, cash equivalents, major customers, presentation under Schedule III, and two revenue and intangible questions from later bulletins. Each is restated in our own words and checked against the current paragraph.
ITFG clarifications are the views of ICAI's Ind AS Technical Facilitation Group as on the date of each bulletin; they are not standards. ITFG says a duty exemption under a government scheme is a government grant to be classified as related to an asset or to income on its conditions; functional currency is set entity by entity, with presentation in any currency; all directors are key management personnel, and sitting fees are disclosed; and an operating profit sub-total does not suit a nature-wise statement of profit and loss. The answers on Ind AS 17 and Ind AS 18 are left out because those standards were superseded.
Ind AS as on 1 April 2025 (ICAI Compendium of Ind AS 2025-26, the standards notified under the Companies (Indian Accounting Standards) Rules, 2015). Amendments notified after 1 April 2025 are not reflected in this article and should be checked on mca.gov.in. Several of these items, such as grant accounting and related party notes, are routine parts of financial statement preparation.
How to read the table
Each issue is cited by bulletin and issue as printed at the end of the answer; the compendium numbers them differently. The last column says whether the paragraph relied on reads the same today. See our guides to foreign currency under Ind AS 21, provisions under Ind AS 37, revenue under Ind AS 115 and analysis of Ind AS financial statements.
Digest
| Situation | ITFG's view | Reference | Paragraph relied on; still the same? |
|---|---|---|---|
| Government loan below market rate, existing at transition | Keep the previous GAAP carrying amount at transition; apply Ind AS 109 afterwards; a sales tax deferral is treated alike | ITFG Clarification Bulletin 12, Issue 7 | Ind AS 101, B10; Ind AS 20, paragraph 10A: reads the same |
| Customs duty exemption on capital goods tied to export conditions | A government grant; classify as asset-related or income-related on the real conditions; income follows the export obligation, or the asset's life if the condition is only subsidiary | Bulletin 11, Issue 5 | Ind AS 20, paragraphs 3, 12, 24, 26, 29: paragraph 24 now permits deferred income or deduction from the asset, so the presentation step has changed |
| Benefits to a unit in a special economic zone | A government grant; same classification judgement | Bulletin 17, Issue 3 | Paragraphs 3, 9: reads the same |
| Contributions from a government that owns the whole company | Check whether it is an owner's contribution (equity) or a grant; a grant cannot go straight to shareholders' funds; capital reserve moves to other equity on transition | Bulletin 9, Issue 3 | Ind AS 20, paragraph 2(c); Ind AS 101, paragraph 10: reads the same |
| Land received as a grant: fair value or nominal amount | Either under the amended standard; a first-time adopter applies it for all periods; an existing adopter can change policy voluntarily only if the result is reliable and more relevant | Bulletin 17, Issue 1 | Ind AS 20, paragraphs 18, 23; Ind AS 8, paragraphs 14, 19: reads the same |
| Subsidiary whose functional currency differs from the parent's | May present in rupees by translating under Ind AS 21; the audit report is on the statements presented | Bulletin 7, Issue 2 | Ind AS 21, paragraphs 17, 18, 38, 39: reads the same |
| Two businesses with different functional currencies in one company | Functional currency is fixed for the entity, not each business | Bulletin 3, Issue 3 | Ind AS 21, paragraphs 8-14, 17: reads the same on the point relied on |
| Sitting fees to independent and non-executive directors | Directors are key management personnel; sitting fees are short-term employee benefits disclosed under paragraph 17 | Bulletin 11, Issue 9 | Ind AS 24, paragraphs 9, 17; Ind AS 19, paragraphs 7, 9: reads the same |
| A public utility subsidiary supplying its own parent | A related party transaction to be disclosed despite regulated tariffs and arm's length terms | Bulletin 17, Issue 6 | Ind AS 24, paragraphs 9, 11, 18: reads the same |
| Money-market fund units as cash equivalents | Rarely: the amount realisable must be known and the value risk insignificant, not just liquidity | Bulletin 16, Issue 4 | Ind AS 7, paragraphs 6-7: reads the same |
| Major customer disclosure for a single-segment entity | Still required for customers of 10 per cent or more; identity need not be named | Bulletin 13, Issue 3 | Ind AS 108, paragraphs 31, 34: reads the same |
| Operating profit line on the face of the statement of profit and loss | Not appropriate where expenses are classified by nature; extra sub-totals are allowed where relevant, with a consistent, disclosed policy; additional information may be given outside the statement | Bulletin 13, Issue 5 | Ind AS Schedule III, Part II, General Instructions 3-5: reads the same, with a grants line added for section 8 companies |
| Voluntary Ind AS adoption and Schedule III format | Division II may be used | Bulletin 3, Issue 1 | Schedule III Division II: history |
| Interest on delayed local taxes | Finance cost if compensatory for time value; other expense if penal | Bulletin 17, Issue 8 | Schedule III Division II, Note 4 to Part II: reads the same |
| Shipping voyage and revenue | Over time if another carrier would not need to redo the work done, or if payment for work to date is enforceable; progress measured on a method suited to the service | Bulletin 19, Issue 2 | Ind AS 115, paragraphs 31, 32, 35, B3, B4: reads the same |
| Gifts to doctors as sales promotion | Outside Ind AS 115; an expense when the entity owns or has access to the gifts, not when given | Bulletin 22, Issue 4 | Ind AS 115, paragraph 6; Ind AS 38, paragraphs 69, 69A: reads the same |
Issues left out
- Issues 95 to 103 of the compendium deal with Ind AS 17 and Ind AS 18, which were superseded by Ind AS 116 and Ind AS 115.
- Issue 78, on disclosing the effect of Ind AS 115 before it was notified, belongs to a period that has passed.
- Issue 128, on a provision for unspent corporate social responsibility spending, is not digested: the law on unspent CSR was changed in 2021, so the answer cannot be applied; see our post on ongoing CSR projects and the unspent CSR account.
Three answers explained
Grants and conditions (Bulletins 11 and 17). Whether an exemption is a grant for an asset or for income turns on the scheme's primary condition and on the costs it compensates. Paragraph 12 of Ind AS 20 matches recognition to those costs, so an export-linked exemption is released as the export obligation is met. Since the presentation paragraph was changed, an asset-related grant may now be shown as deferred income or deducted from the asset.
Functional currency (Bulletins 3 and 7). Paragraphs 9 to 14 of Ind AS 21 set the functional currency for the entity as a whole; presentation in another currency (including rupees) follows paragraphs 38 and 39 without changing it.
Related parties (Bulletins 11 and 17). A director of any kind is key management personnel, and compensation including sitting fees goes in the paragraph 17 table. A parent-subsidiary relationship brings a transaction into paragraph 18 even if the ordinary supplier relationship would not.
What a finance team should take from this
- List every government scheme benefit and classify it as asset or income related from the scheme's conditions.
- Document the functional currency conclusion at entity level, and the presentation currency separately.
- Include all directors and their fees in the related party schedule.
Need help with grants and disclosures?
If scheme benefits, currency decisions or related party schedules need to be put on an Ind AS footing, our team can prepare the workings and notes as part of financial statement preparation.
Key takeaways
- Duty exemptions and special-zone benefits are grants; classify on conditions.
- Functional currency is an entity-level conclusion; presentation currency is a separate choice.
- Directors, including non-executive ones, are key management personnel.
- Money-market units seldom qualify as cash equivalents.
- Operating profit sub-totals do not fit a nature-wise statement.
Read next
- Foreign currency under Ind AS 21
- Provisions under Ind AS 37
- Revenue under Ind AS 115: the five-step model
- Analysis of Ind AS financial statements
Disclaimer: Based on the Indian Accounting Standards as on 1 April 2025 (ICAI Compendium of Ind AS 2025-26, the standards notified under the Companies (Indian Accounting Standards) Rules, 2015) and, where named, the ITFG clarification bulletins of ICAI, as consulted on 4 October 2026. Amendments notified after 1 April 2025 should be checked on mca.gov.in. This article is general information, not legal advice; check the official text before acting.