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Indemnification asset under Ind AS 103 is subsequently measured:
AOn the same basis as the indemnified liability/asset, subject to contractual limitations and (if not at FV) management's assessment of collectability — derecognised only on collection, sale or loss of right
BSubsumed into goodwill at year-end
CAt the lower of fair value and cost
DAlways at fair value through P&L
Answer & Solution
Correct answer: A. On the same basis as the indemnified liability/asset, subject to contractual limitations and (if not at FV) management's assessment of collectability — derecognised only on collection, sale or loss of right
Paragraph 57 mirrors the indemnified item's basis (so that asset & liability move together), subject to contractual caps and collectability assessment for non-FV measured indemnification assets. Derecognition is event-driven (collect / sell / lose right).
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