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Under Ind AS 101, a PARENT COMPANY can carry its INVESTMENT IN A SUBSIDIARY in its SEPARATE financial statements at:
ACost of investment plus subsequent dividends received
BEither the previous-GAAP carrying amount, OR the FAIR VALUE at the date of transition (deemed cost), at the entity's election
COnly the previous-GAAP carrying amount — separate financials cannot recognise fair-value uplifts
DOnly fair value — Ind AS 27 requires fair-value carrying for investments
Answer & Solution
Correct answer: B. Either the previous-GAAP carrying amount, OR the FAIR VALUE at the date of transition (deemed cost), at the entity's election
An optional exemption permits a parent to use either previous-GAAP carrying amount OR fair value at transition (deemed cost) for its investment in a subsidiary in SEPARATE FS. If fair value is elected, the differential vs previous-GAAP amount goes to retained earnings at transition. This is independent of the sub's deemed-cost election in its own FS.
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