Hidden Risk of Long Term Liability | IASB New Guidance | IAS 37 | Ind AS 37 | Uncertainty | CA Final

Decommissioning and Site Restoration Obligations : What You Must Disclose
Long-term Liability | IASB’s Latest Guidance

The IASB’s November 2025 illustrative examples, inter alia, sheds light on how an entity might disclose information about plant decommissioning and site restoration obligations - even if their effect on the carrying amount of the entity’s plant decommissioning and site restoration provision is immaterial.

The new guidance requires an entity to provide the required disclosures, as contemplated under paragraph 85 of IAS 37 (and Ind AS 37, in the Indian context) - because the information about its obligations to decommission plant and for site restoration is material, even though the provision recognized is quantitatively immaterial, as the cost to settle the obligation is discounted to its present value.

The example illustrates several factors that might be relevant in determining whether the obligation is material. In particular, this example illustrates the requirements in paragraph 85 of IAS 37 Provisions, Contingent Liabilities and Contingent Assets, (and Ind AS 37 in the Indian context) which include disclosure requirements for each class of provision recognized.

In this video, I break down:
• How an entity applies the materiality test – to determine whether the obligation is material
• Why external qualitative factors like risk of early settlement matter in this assessment
• Practical steps to correctly apply paragraph 85 disclosure requirements from a practical real‑world financial reporting

👉 Watch now to see how this guidance can reshape disclosures and strengthen transparency in financial reporting.

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Видео Hidden Risk of Long Term Liability | IASB New Guidance | IAS 37 | Ind AS 37 | Uncertainty | CA Final канала KnowledgeFlow With CA Anjani Kumar Khetan