Ind AS 112: Disclosure of Interests in Other Entities

Standard orientation

What Ind AS 112 is designed to achieve

Require disclosures enabling users to evaluate the nature and risks of interests in other entities and their effects on financial position, performance and cash flows.

Scope: Applies to interests in subsidiaries, joint arrangements, associates and unconsolidated structured entities. It complements recognition and measurement under Ind AS 110, 111, 28 and 109.

Judgements

Disclose significant conclusions about control, joint control, influence and investment-entity status.

Subsidiaries

Explain group composition, material NCI, restrictions, support and ownership changes.

Associates/JVs

Disclose nature, summarised information, commitments and risks.

Structured entities

Explain purpose, exposure, maximum loss and support provided or intended.

Reading method: Requirements are paraphrased and grouped where they form one integrated rule. Apply the current notified standard for final conclusions.

Full standard map

Paragraph-by-paragraph register

Paragraphs	Requirement and simple decode
1	Objective Enables evaluation of nature, risks and financial effects of interests in other entities.
2	Disclosure principles Requires significant judgements, composition of group, NCI interests, restrictions, changes, joint/associate information and structured-entity risks.
3	Aggregation and detail Use the level of detail necessary to meet the objective and aggregate or disaggregate without obscuring useful information.
4–6	Scope Covers subsidiaries, joint arrangements, associates and unconsolidated structured entities, with specified exclusions for benefit plans, separate statements and certain financial instruments.
7–9	Significant judgements Disclose judgements and assumptions in determining control, joint control, significant influence and type of joint arrangement, including changes in conclusions.
9A–9B	Investment-entity judgements Disclose judgements when the entity lacks one or more typical characteristics or changes status.
10–11	Interests in subsidiaries — objective Enable users to understand group composition, material NCI, restrictions, risks of consolidated structured entities and effects of ownership changes.
12	Group composition and NCI Disclose subsidiary name, place, NCI ownership/voting interests, profit allocation, accumulated NCI and summarised financial information for material NCI.
13	Restrictions Disclose significant restrictions on accessing or using group assets and settling liabilities, including protective rights and guarantees.
14–17	Consolidated structured entities Disclose contractual support requirements, support provided without obligation and intentions to provide support.
18	Ownership changes without loss Present a schedule showing effects on equity attributable to owners of the parent.
19	Loss of control Disclose gain/loss, portion attributable to retained investment remeasurement and line item recognised.
19A–19G	Investment entity interests Disclose significant subsidiaries measured at FVTPL, restrictions, support and changes in status.
20	Joint arrangements and associates — objective Enable users to evaluate nature, extent and financial effects and associated risks.
21	Basic information Disclose names, relationship nature, principal place, ownership/voting proportions and measurement method.
21A	Investment-entity associate/JV interests Provides tailored disclosure when an investment entity applies FVTPL.
22	Additional judgements and restrictions Disclose fair value where quoted, restrictions, differing reporting dates and unrecognised losses.
B12–B13	Material joint ventures and associates Provide summarised financial information individually for each material JV/associate.
B14–B17	Reconciliation Reconcile summarised financial information to investment carrying amount, including ownership, goodwill and other adjustments.
B18–B19	Immaterial interests Disclose aggregate carrying amounts and shares of profit, OCI and comprehensive income.
23	Risks associated with JVs and associates Disclose commitments relating to JVs and contingent liabilities relating to JV/associate interests.
24	Unconsolidated structured entities — objective Enable users to understand nature and extent of interests and evaluate associated risks.
25–26	Nature and sponsorship Disclose qualitative and quantitative information about purpose, size, activities, financing and sponsorship, including entities with no reporting-date interest.
27–30	Risk exposure Present carrying amounts, line items, maximum exposure to loss, comparison with carrying amounts, support provided without obligation and intentions to support.
Appendix A	Definitions Defines income from structured entity, interest in another entity and structured entity.
Appendix B B1–B3	Application guidance Explains aggregation, materiality and cross-referencing.
B4–B6	Judgement examples Provides examples for control with minority voting rights, agency relationships and significant influence.
B7–B11	Subsidiary summarised information Specifies current/non-current assets and liabilities, revenue, profit, OCI and cash-flow information before intra-group eliminations.
B20–B26	Structured-entity interest Explains contractual and non-contractual involvement, sponsorship, exposure and maximum-loss measurement.
C1–C3	Transition Provides relief for comparative disclosures on initial application.

Major areas decoded

Technical requirements in simple language

Disclosure objective first

A checklist is insufficient. Management must add entity-specific information needed to explain unusual structures, restrictions and risk.

Significant judgement

Borderline control or influence conclusions should explain the facts and why rights are substantive or protective, not merely state the conclusion.

Material NCI

Summarised information is provided before intra-group eliminations and must be meaningful enough to understand the subsidiary.

Restrictions

Cash trapped by regulation, covenants, minority rights, exchange controls or ring-fencing can be more decision-useful than ownership percentages.

Support to structured entities

Voluntary liquidity support can reveal reputational or economic compulsion and must be disclosed even without a contractual obligation.

Maximum exposure

The disclosed maximum loss is not automatically expected loss or fair value; explain how it is determined and where it differs from carrying amount.

Aggregation

Do not combine risks with materially different characteristics merely to shorten notes.

Recognition boundary

Ind AS 112 does not decide control, equity accounting or fair value; it explains conclusions and exposures arising under other standards.

Visual learning

Finin2min decision map

Editable SVG and high-resolution PNG versions are included in this batch.

Exceptions and highlights

What professionals frequently overlook

Ind AS 112 does not replace Ind AS 24 related-party disclosures.
Separate financial statements have tailored requirements and may rely on Ind AS 27 disclosures.
Materiality applies, but the standard’s disclosure objectives must still be met.
Material subsidiaries with NCI require individual summarised information.
Immaterial associates and JVs can be aggregated by category.
Structured-entity disclosures can apply even when no reporting-date interest exists if the entity sponsored the structure.
Voluntary support without a legal obligation is disclosable.
Maximum exposure to loss is not a probability-weighted estimate.

Practical application

Transaction examples

Fact pattern

Treatment

Reason

Material subsidiary with 35% NCI

Individual summarised disclosures

Users need to understand material NCI interests.

Loan covenant restricts subsidiary dividends

Restriction disclosure

It limits access to group cash.

Sponsor sold securitisation notes before year-end

Sponsorship disclosure may remain

Past sponsorship can remain relevant without a current interest.

Bank provides voluntary liquidity to an unconsolidated vehicle

Disclose support and reasons

Support reveals exposure beyond contractual carrying amounts.

Three immaterial associates

Aggregate specified metrics

Aggregation is allowed when not obscuring different risks.

Control conclusion changes after shareholder dispersion changes

Disclose changed judgement

Users need the facts causing the reassessment.

Accounting mechanics

Illustrative journal entries

Entries are simplified and may require tax, fair-value or presentation adjustments.

Disclosure-only standard

Ind AS 112 normally creates no journal entry by itself.

Support payment to structured entity

Apply the relevant recognition standard, then disclose nature and exposure under Ind AS 112.

Ownership change retaining control

Record under Ind AS 110 equity accounting, then disclose the equity effect.

Loss of control

Record under Ind AS 110, then disclose disposal gain and retained-interest effect.

CA / finance / boardroom cases

Applied case studies

1. Borderline control

Applied case

A group holds 46% with remaining ownership concentrated among three active investors.

Finin2min analysis: Explain the significant judgement and evidence supporting control or non-control; a generic policy note is insufficient.

2. Material NCI

Applied case

A subsidiary accounts for 40% of group assets and has 30% external ownership.

Finin2min analysis: Provide entity-specific NCI information and summarised financial information before intra-group eliminations.

3. Trapped cash

Applied case

A regulated subsidiary cannot remit cash without regulator consent.

Finin2min analysis: Disclose the nature and carrying amounts of assets/liabilities subject to significant restriction.

4. Structured vehicle

Applied case

A bank has no equity in a securitisation vehicle but holds a liquidity facility and servicing rights.

Finin2min analysis: Assess whether each involvement is an interest and disclose nature, carrying amount, maximum exposure and support.

5. Voluntary rescue

Applied case

An entity injects funds into an unconsolidated fund to protect its reputation despite no contract.

Finin2min analysis: Disclose the support, reasons and future support intentions, and reassess control and recognition under other standards.

Global comparison

Ind AS versus IFRS and US GAAP

Topic	Ind AS	IFRS	US GAAP
Core scope	Subsidiaries, JAs, associates and unconsolidated structured entities.	Broadly aligned with IFRS 12.	US GAAP disclosures are distributed across consolidation, VIE and equity-method topics.
Judgement disclosures	Explicit control/joint control/influence and investment-entity judgements.	Aligned.	US GAAP requires significant VIE and consolidation judgements with different structure.
Material NCI	Entity-level summarised information.	Aligned.	US disclosures differ in format and scope.
Unconsolidated structured entities	Nature, exposure, maximum loss and support.	Aligned.	US VIE disclosures often include similar exposure concepts but different definitions.
Recognition	No recognition model; complements other standards.	Aligned.	US disclosure requirements similarly accompany separate recognition models.

Implementation lens

Implications for key stakeholders

Group reporting

Build a disclosure data pack linked to consolidation conclusions.

Treasury

Identify restrictions, guarantees, liquidity facilities and support.

Legal

Map contractual commitments and ring-fencing.

Investor relations

Explain NCI, associate and structured exposures clearly.

Audit committee

Challenge boilerplate and incomplete maximum-loss disclosures.

Quality-control watchlist

Common errors and exam traps

Using boilerplate for significant control judgements.
Omitting changed judgements.
Presenting material NCI information after intra-group eliminations.
Failing to disclose trapped cash and covenant restrictions.
Aggregating materially different associates or structured entities.
Omitting commitments relating to joint ventures.
Ignoring contingent liabilities connected with associates/JVs.
Assuming no year-end ownership means no structured-entity disclosure.
Omitting voluntary support.
Calling maximum exposure expected loss.
Failing to reconcile summarised information to carrying amount.
Using Ind AS 112 disclosures as a substitute for Ind AS 24.

Finin2min Q&A

Frequently asked questions

1. Does Ind AS 112 determine control?

No; Ind AS 110 determines control and Ind AS 112 explains the judgement and effects.

2. What subsidiaries need summarised information?

Those with NCI material to the reporting entity.

3. Must restrictions on cash transfers be disclosed?

Yes when significant.

4. Are immaterial associates disclosed individually?

They can generally be aggregated by category.

5. What is maximum exposure to loss?

The maximum loss the entity could incur from its involvement, not necessarily expected loss.

6. Is voluntary support disclosable?

Yes, including reasons and future intentions.

Two-minute revision

Finin2min cheat sheet

JUDGEMENTS → GROUP/NCI → RESTRICTIONS & SUPPORT → MATERIAL JV/ASSOCIATE DATA → STRUCTURED-ENTITY EXPOSURE → RECONCILE & EXPLAIN

Validation register

Primary and authoritative sources

ICAI Compendium 2025–26 — Volume IPrimary or authoritative validation source.
Open source ↗

IFRS Foundation — IFRS 12Primary or authoritative validation source.
Open source ↗

ICAI Educational Materials indexPrimary or authoritative validation source.
Open source ↗

Review date: 26 June 2026. Recheck later MCA notifications and ICAI compendiums before applying to a later reporting period.