Service Concession Agreement Ind As

Example: construction of a hospital under a public service concession; Conditions of consideration: the operator receives from the licensor, depending on the actual occupation in the hospital. The licensor did not guarantee the operator a minimum occupancy. The operator shall recognise a financial asset to the extent that it has an unconditional contractual right to receive cash or other financial assets from or at the direction of the licensor for the works. The operator is fully entitled to cash payment if the concessionaire contractually guarantees the operator to pay for infrastructure, including roads, ports and airports, which play an important role in the economic growth of a country. In order to promote the participation of the private sector in infrastructure development, Governments have formulated numerous public-private partnership programmes. A BOOT (Build, Operate, Transfer)/Build, Own, Operate and Transfer (BOOT) agreement typically includes the construction/modernization of infrastructure by a private sector company (operator) as well as operation and maintenance for a certain period of time. At the end of the agreement, the infrastructure assets can be transferred to the public body (concessionaire). Under the agreement, the operator can either obtain the right to charge charges (tolls) to users of the infrastructure, or the licensor can pay certain periodic amounts (pensions) to the operator. Current practices under Indian GAAPNA notified accounting standard addresses the issue of Indian GPAP. In 2014, ICAO published a draft accounting guide to concession agreements for service concessions by concessionaires, which has not yet been finalized. In the absence of guidelines, different practices appear to have emerged to explain these agreements and many companies appear to have followed different practices. For example, some companies have recorded "infrastructure assets" as fixed assets, while others have recorded them as intangible assets. Many companies do not record turnover and profits during the construction period.

As a general rule, the concessionaire requires that each BOT/BOOT project be carried out by a separate legal entity. To meet this requirement, groups carrying out infrastructure activities constitute a separate specific vehicle (SPV) for the implementation of each project. In many cases, the SPV outsources all or a substantial part of the construction activity to its parent company. This results in the recording of significant construction income in the parent company`s individual financial statements (FSS). In the consolidated accounts (SFC), all intra-group balances and intra-group transactions and the resulting unrealized profits can be completely eliminated. Therefore, compared to the SFS of the parent company, a group company may have significantly lower turnover and profits in the CFS. Overview of ADR requirements in Annex C of Ind-AS 115 Service Concession Agreements Revenues generated by customer contracts (the Annex) apply to public and private BMS if they meet both of the following conditions:a. The licensor controls or regulates the services that the operator must provide with the infrastructure, to whom it must make them available and at what price.b. . . .

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