Ind AS 112 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.
Ind AS 112 is a single, comprehensive disclosure standard for interests in subsidiaries, joint arrangements, associates and unconsolidated structured entities. It requires entities to disclose the judgements made, the nature and extent of interests, and the risks arising from them.
Overview
Ind AS 112, Disclosure of Interests in Other Entities, notified under the Companies (Indian Accounting Standards) Rules, 2015, gathers into one place the disclosure requirements that accompany Ind AS 110, 111 and 28. It contains no recognition or measurement rules — its sole purpose is to give users enough information to assess the nature and financial effects of a reporting entity's involvements with other entities.
Scope and Applicability
The standard applies to any entity that has an interest in a subsidiary, a joint arrangement, an associate or an unconsolidated structured entity. It does not apply to post-employment benefit plans, separate financial statements (covered by Ind AS 27) or certain interests accounted for under Ind AS 109 where the entity does not have significant influence.
Key Disclosure Areas
| Interest | Illustrative disclosures |
|---|---|
| Subsidiaries | Composition of the group; material NCI; summarised financials; restrictions on assets |
| Joint arrangements & associates | Nature, extent and financial effects; summarised financial information; commitments |
| Unconsolidated structured entities | Nature and extent of interests; maximum exposure to loss; support provided |
Significant Judgements and Assumptions
Ind AS 112 requires an entity to disclose the significant judgements it made when concluding that it does or does not control an investee, that it has joint control or significant influence, and when classifying a joint arrangement as a joint operation or joint venture. These narrative disclosures make the control conclusions in Ind AS 110/111 transparent to users.
Interests in Subsidiaries
Where non-controlling interests are material, the entity discloses, for each such subsidiary, its name and principal place of business, the NCI ownership percentage, profit or loss allocated to NCI during the period, accumulated NCI at the reporting date, and summarised financial information (assets, liabilities, revenue, profit and cash flows). Significant restrictions on accessing or using group assets are also disclosed.
Worked Example
A parent has a subsidiary in which the NCI is 30%. The subsidiary reports total assets of ₹50,00,000, revenue of ₹20,00,000 and profit of ₹4,00,000. Under Ind AS 112 the parent discloses that ₹1,20,000 (30% × ₹4,00,000) profit was allocated to NCI and presents the subsidiary's summarised financials so users can gauge the NCI's stake in the group.
Structured Entities and Risk
For unconsolidated structured entities, the entity discloses the nature and extent of its interests, its maximum exposure to loss, and any financial or other support given or intended without a contractual obligation. This is critical for institutions involved in securitisation and similar vehicles, where off-balance-sheet risk must be visible.