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After initial recognition under Ind AS 103, a CONTINGENT LIABILITY recognised in a business combination is subsequently measured at:
AAlways at the original acquisition-date amount
BFair value at every reporting date with changes through OCI
CThe higher of (a) Ind AS 37 amount, or (b) initial recognition amount less, where appropriate, cumulative income recognised under Ind AS 115
DThe lower of Ind AS 37 amount and the initial amount
Answer & Solution
Correct answer: C. The higher of (a) Ind AS 37 amount, or (b) initial recognition amount less, where appropriate, cumulative income recognised under Ind AS 115
Ind AS 103 paragraph 56: subsequent measurement is at the HIGHER of (a) Ind AS 37 measurement, and (b) initial amount less cumulative Ind AS 115 income (if any) — so the liability cannot 'wash out' by mere passage of time below its Ind AS 37 floor.
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