AS 22 vs Ind AS 12 Explained | P&L vs Balance Sheet Approach | CA Final | Concepts | Know why

Hey guys, let's talk about the main difference between Accounting Standard 22 and Ind AS 12! 📊 AS 22 used to follow the Profit & Loss (P&L) approach to achieve its goal, whereas Ind AS 12 solves the exact same thing using the Balance Sheet approach. But here's the best part—the answer you get from the P&L approach will be the exact same answer you get from the Balance Sheet approach! 💡 Think about this basic concept: Opening balance plus Current Year P&L equals your Closing balance. If we calculate the P&L provision and add the opening provision, we get the closing provision figure for the balance sheet Now, what if we reverse it? What if we calculate the closing provision first, take our known opening provision, and use the difference to find the P&L data? Will the answer be the same? YES! Don't stress right now about how we calculate that closing figure first—leave that completely up to me Just focus on the fact that the result is exactly the same. It's just like what you learned back in 11th and 12th grade with the Statement of Affairs method in Single Entry: Opening Capital + Profit = Closing Capital, which means Closing Capital - Opening Capital = Profit! 📝 This shift in approach is exactly what we are diving into in today's class. I'll show you step-by-step how we used to do it under AS 22, and how we do it now under Ind AS 12, so don't worry about a thing #AccountingStandards #IndAS12 #AS22 #FinanceEducation #AccountingTips #CommerceStudents #CAInter #CAFinal #BalanceSheet #ProfitAndLoss