Classification of Liabilities as Current or Non-Current in Case of Refinancing Under Ind AS Framework
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- By Chetan Kulasri
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- Last Updated on 5 March, 2025
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This document explores the classification of liabilities as current or non-current under Ind AS 1 in the case of loan refinancing. It highlights a scenario where a loan, due within twelve months, was sanctioned for refinancing before the reporting date but was formally finalized only after the balance sheet date and before the approval of financial statements. The key issue addressed is whether the liability should be classified as current or non-current, considering the requirement of having an unconditional right to defer settlement before the reporting date.
The document further examines the relevance of Ind AS 10, distinguishing between adjusting and non-adjusting events, and evaluates whether a refinancing agreement signed after the reporting date impacts the classification of liabilities.
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