Editorial Team – [2026] 185 taxmann.com 153 (Article)

World Corporate Law News provides a weekly snapshot of corporate law developments from around the globe. Here’s a glimpse of the key corporate law update this week.

1. Securities Law

1.1 SEC announces Agenda and Panelists for Roundtable on Options Market Structure

On April 2, 2026, the Securities and Exchange Commission (SEC) announced the agenda and panelists for its roundtable on options market structure, scheduled for April 16, 2026.

The roundtable will be held at the SEC’s headquarters at 100 F Street, N.E., Washington, D.C., from 9:00 a.m. to 3:15 p.m. ET. The event will be open to the public and webcast live on the SEC’s website. Doors will open at 8:00 a.m. ET.

For online attendance, registration is not necessary. A link to watch the event will be available on April 16 at www.sec.gov, and a recording will be made available on the SEC’s website at a later date.

Source – Press Release

1.2 Explanatory Brief – The Securities and Futures (Amendment) Bill 2026

The Minister for National Development and Deputy Chairman of the Monetary Authority of Singapore (MAS), Mr Chee Hong Tat, on behalf of Deputy Prime Minister and Minister-in-charge of the MAS, Mr Gan Kim Yong, moved the Securities and Futures (Amendment) Bill 2026 for the First Reading in the Parliament.

The Bill seeks to enable the implementation of the proposed regulatory regime for the Global Listing Board (GLB) that the Singapore Exchange Securities Trading (SGX) and the Nasdaq Stock Market (Nasdaq) will establish.

The GLB will enable issuers to list on both exchanges under a streamlined regulatory framework simultaneously. The Bill also provides MAS flexibility to adopt a similar framework for dual listing arrangements with other overseas exchanges should future opportunities arise.

MAS has conducted public consultation on the key amendments in the Bill. Comments received have been considered and, where appropriate, incorporated into the Bill.

Key Amendments in the Bill

Amendments have been made to two key areas, which are described below.

(a) New Part 13A

The Bill inserts a new Part 13A into the Securities and Futures Act 2001 (SFA) that empowers MAS to make regulations to facilitate the establishment of a dual-listing board (DLB) by SGX and an overseas exchange through a streamlined regulatory framework. The main amendments are as follows:

• Power to Prescribe Dual Listing Arrangements –  To effect the streamlined regulatory framework, MAS will be empowered to declare an overseas exchange (such as Nasdaq) as a “prescribed overseas exchange”. Likewise, MAS may also declare a dual-listing board set up by SGX (such as the GLB with Nasdaq) as a “prescribed DLB”.
• Regulation-making Powers – To harmonise potential differences between Singapore’s securities laws and those of the foreign jurisdiction, MAS may make regulations to replace, modify, or disapply the offer-related provisions and market misconduct provisions in the SFA for the prescribed DLB.

The regulation-making powers are subject to safeguards and minimum standards. The new Part 13A sets out the criteria that MAS would consider when deciding whether to prescribe a dual listing board as a prescribed DLB. These include whether the overseas exchange:

(i) enhances issuers’ access to liquidity and international investors; and

(ii) operates in a jurisdiction with securities laws that are in line with international standards in key areas such as disclosure, enforcement and regulatory co-operation.

(b) Other Amendments

In addition to the new Part 13A, the Bill makes other amendments to the SFA that apply to all offers generally. The main amendments are as follows:

• Earlier Engagement With Retail Investors – Issuers will be able to disseminate their preliminary prospectus when marketing to retail investors, and not only to institutional and accredited investors as is the case currently.
  This will enable issuers to engage retail investors in Singapore before the lodgement of the final prospectus. Such engagements are subject to safeguards. For instance, no official offer can be made based on the preliminary prospectus.
  In addition, the preliminary prospectus must clearly state that its content is subject to further changes. The issuer must also make a reasonable effort to inform recipients when the prospectus is finalised and ready for collection.
• Treatment of Sponsored Depositary Receipts – For offers of sponsored depositary receipts, the issuer of the underlying securities, rather than the depositary, must register the prospectus. Investors will therefore obtain information about the issuer, rather than the financial institution that acts as an intermediary in issuing the depositary receipts.

Source – Official Announcement

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Circular No. HO/49/14/14(13)2026-CFD-POD2/ I/8772/2026, Dated: 07.04.2026

Click Here To Read The Full Circular

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Press Release: 2026-2027/36, Dated: 08.04.2026

The Reserve Bank of India’s Monetary Policy Committee (MPC), after reviewing macroeconomic conditions and financial developments, has announced its latest policy decisions.

1. Policy Rates Remain Unchanged

The MPC has decided to keep key policy rates unchanged:

• Repo Rate – 5.25%
• Standing Deposit Facility (SDF) Rate – 5.00%
• Marginal Standing Facility (MSF) Rate – 5.50%
• Bank Rate – 5.50%

2. Liquidity Adjustment Framework

These rates continue to operate under the Liquidity Adjustment Facility (LAF), ensuring:

• Stability in short-term interest rates
• Effective liquidity management in the banking system

3. Monetary Policy Stance

The MPC has decided to maintain a ‘neutral’ stance, indicating:

• Flexibility to respond to evolving economic conditions
• A balanced approach between inflation control and growth support

4. Assessment of Economic Conditions

The decision reflects:

• Resilient economic growth
• Ongoing evaluation of inflation trends and global uncertainties

5. Conclusion

The RBI’s policy stance signals continuity and caution, aiming to maintain macroeconomic stability while retaining the flexibility to act as economic conditions evolve.

Click Here To Read The Full Press Release

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Ajay Wadhwa & Shivam Garg – [2026] 185 taxmann.com 149 (Article)

1. Statutory Setting

1.1 Section 153D mandates that no assessment or reassessment order in a search or requisition case, by an Assessing Officer below the rank of Joint Commissioner, shall be passed except with the prior approval of the Joint Commissioner in respect of each assessment year. The legislative object behind insertion of section 153D, as noticed in CBDT Circular No. 3 of 2008 and in later judicial decisions, was to provide an inbuilt supervisory check in search assessments, which are unusual proceedings with potential serious civil and criminal consequences.

1.2 Courts have therefore consistently held that the requirement of approval under section 153D is not an idle formality. Although the approving authority is not expected to write a detailed adjudicatory order, the approval must nevertheless indicate that the authority examined the relevant material and granted approval upon due application of mind. The approval is intended to be a real statutory safeguard, not a ritualistic endorsement.

2. Judicial Position Prior to Insertion of Section 292BC

2.1 Prior to section 292BC, the Tribunal and Hon’ble High Courts had invalidated search assessments where the approval under section 153D was found to be mechanical or perfunctory. The principal grounds emerging from the case law were these:

(a) the approval did not demonstrate any application of mind;

(b) the approval did not indicate that the draft assessment order and relevant records like the appraisal report, assessment record etc., had been examined;

(c) one omnibus approval was granted for multiple assessment years and, in some cases, for multiple assessees, contrary to the phrase “each assessment year” being an explicit requirement in section 153D;

(d) the approval was granted on the same day, or within an implausibly short time after the proposal, suggesting that there was no realistic opportunity to examine the records;

(e) the approval stage under section 153D was treated by the Courts as a distinct statutory stage, and not something that could be justified by pointing to the approving authority’s earlier general involvement in the assessment proceedings.

2.2 In Serajuddin, the Orissa High Court held that there was not even a token indication that the Additional CIT had perused the draft orders; it observed that while elaborate reasons were not necessary, there had to be some indication of the thought process. The Court also emphasised that a draft put up only two days before the limitation placed the approving authority under undue pressure and impaired meaningful scrutiny.

2.3 The Hon’ble Delhi High Court has also treated the requirement seriously. It has emphasised that section 153D operates in respect of “each assessment year” and that the legislative intent behind the provision is that the superior authority must apply its mind to the material on the basis of which the assessment is proposed.

2.4 The Bombay High Court has gone further to state that although approval under section 153D need not be a detailed judgment, it must reflect at least minimum application of mind, and such a defect cannot be cured later by affidavit.

3. Text and Scope of the New Section 292BC

3.1 By Finance Act, 2026, Parliament inserted section 292BC with retrospective effect from 1 April 2021. The section provides, inter alia, that any approval given by an income tax authority in relation to assessment, reassessment or recomputation proceedings shall be deemed to be administrative and supervisory in nature and shall not be invalid merely by reason of insufficiency of the reasons recorded or by reason of any defect in the form or manner of its authentication or communication, including non appending of digital signature where the approval is granted electronically.

3.2 Section 292BC as inserted by Finance Act, 2026 is reproduced as under:

“292BC.Circumstances in which approvals by income-tax authority not to be invalid: Notwithstanding anything contained in this Act or in any judgment, order or decree of any Court, for the removal of doubts, it is hereby clarified that any approval given by an income-tax authority in relation to any assessment, reassessment or recomputation proceedings under this Act shall be deemed to be administrative and supervisory in nature and shall not be invalid or shall not be deemed to be invalid by reason of any insufficiency of the reasons recorded or by reason of any defect in the form or manner of its authentication or communication including whether digital signature have been appended to such approval or not, where such approval is granted electronically.”.

3.3 The amendment is thus clearly intended to blunt a category of challenges based on the nature and drafting of approval notes. It would be unrealistic to argue that the amendment has no effect at all. It does. It materially weakens contentions founded only on these propositions:

(a) that the approval note is too brief;

(b) that the reasons are inadequate in extent or detail;

(c) that the approval suffered from defects in form, authentication, digital signature or communication.

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1. Query

Delta Private Limited (hereinafter referred to as “the company”) is a Non-Banking Financial Company (NBFC) engaged in financing and leasing activities, including leasing of electric vehicles. The leases entered into by the company are classified as finance leases in accordance with Accounting Standard (AS) 19, Leases, and accordingly, lease receivables are recognised based on the net investment in the lease, including residual value components.

As per the Scale-Based Regulations (SBR) issued by the Reserve Bank of India (RBI), the company is required to create minimum provisions in respect of its lease portfolio. The provision is computed with reference to total dues, reduced by the depreciated value of the underlying asset. The regulations issued by RBI prescribe that such depreciated value should be computed notionally using the original cost of the asset and applying depreciation at a specified rate on a straight-line basis.

However, the regulations do not clarify whether any adjustment should be made for salvage value (or residual value) while computing such depreciated value. The company is of the view that, since AS 10 requires the deduction of residual value in determining the depreciable amount, a similar approach may be considered for this purpose.

Further, in many lease arrangements, the company has exposure to guaranteed residual values or purchase options, which raises an additional question regarding the determination of an appropriate salvage value, if considered.

The management of the company, while finalising the books of account, was in a dilemma as to whether salvage value should be considered while computing notional depreciated value under the SBR Regulations?

2. Relevant Provisions

AS 10 – Property, Plant and Equipment

Para 55 of AS 10

The depreciable amount of an asset is determined after deducting its residual value.

AS 19- Leases

Para 26 of AS 19

The lessor should recognise assets given under a finance lease in its balance sheet as a receivable at an amount equal to the net investment in the lease.

Preface to the Statements of Accounting Standards

The Accounting Standards, by their very nature, cannot and do not override the local regulations that govern the preparation and presentation of financial statements in the country. However, the ICAI will determine the extent of disclosure to be made in financial statements and the auditor’s report thereon.

Scale-Based Regulations – RBI

NBFCs engaged in leasing or hire purchase are required to compute minimum provisions based on total dues reduced by:

(a) Unmatured finance charges; and

(b) Notional depreciated value of the asset, computed using straight-line depreciation at a prescribed rate

3. Analysis

The issue under consideration is whether principles relating to residual value under AS 10 can be extended to the computation of the notional depreciated value prescribed under the SBR Regulations.

Under AS 10, residual value is an integral component in determining the depreciable amount of an asset for financial reporting purposes. The standard requires that depreciation be computed after deducting the estimated residual value, irrespective of the method of depreciation used. This principle, however, applies specifically in the context of accounting for property, plant and equipment.

In contrast, the present case involves the computation of a notional depreciated value for the limited purpose of determining provisioning requirements under a regulatory framework. The SBR Regulations prescribe a specific methodology for such computation, based on original cost and a fixed rate of depreciation on a straight-line basis. The regulations do not provide for any adjustment on account of salvage or residual value.

Further, AS 19 governs accounting for finance leases and introduces the concept of residual value, including guaranteed and unguaranteed components, for the purpose of determining lease receivables. However, such concepts are relevant for the measurement of net investment in the lease and do not extend to provisioning requirements. Notably, AS 19 does not prescribe any provisioning mechanism that incorporates residual value.

In the present case, the provisioning requirement arises from the SBR Regulations, which constitute a specific regulatory framework applicable to NBFCs. As per the Preface to the Statements of Accounting Standards, accounting standards cannot override regulatory requirements where inconsistencies exist. Therefore, where the SBR Regulations prescribe a particular method for computing provisions, such method must be followed as it stands.

Accordingly, the principle of deducting residual value under AS 10 cannot be imported into the computation of notional depreciated value under the SBR Regulations.

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Case Details: Bansal Casting vs. Union of India [2026] 185 taxmann.com 29 (Punjab & Haryana)

Judiciary and Counsel Details

• Mrs Lisa Gill & Ramesh Chander Dimri, JJ.
• Ms Radhika Suri, Sr. Adv., Ms Parnika Singla, Abhinav Narang, J.S. Bedi & Aman Garg, Advs. for the Petitioner.
• Saurabh Kapoor, R.S. Pandher, Addl. A.Gs., Ms Mamta Singla Talwar, DAG, Sourabh Goel & Ajay Kalra, Sr. Standing Counsels for the Respondent.

Facts of the Case

The petitioners were issued show cause notices in Form GST REG-17 on generic grounds without proposing retrospective cancellation or furnishing documents relied upon. Subsequently, the jurisdictional officer under CGST passed cryptic, non-speaking cancellation orders with retrospective effect, without disclosing the basis, and, in certain cases, even from a prior date or after the application for voluntary cancellation. Aggrieved, the petitioners filed writ petitions challenging the validity of such notices and orders on grounds of violation of principles of natural justice and lack of proper reasoning. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that retrospective cancellation under Section 29 of the CGST Act and Haryana GST Act, read with Rule 22 of the CGST Rules and Haryana GST Rules, requires due process, including proper notice and recorded reasons. It was observed that the absence of a proposal for retrospective cancellation and the non-supply of relied-upon documents denied an effective opportunity of defence. The Court held that cryptic, non-speaking and mechanical orders reflected non-application of mind and were unsustainable, and such defects could not be cured by post facto justifications. Accordingly, the impugned notices and orders were set aside to the extent of retrospective effect, with liberty to initiate fresh proceedings in accordance with law.

List of Cases Referred to

• Ajay Gupta v. Sales Tax Officer [2025] 179 taxmann.com 18 (Delhi) (para 6)
• Pooja Enterprises v. Sales Tax Officer Class II Avato [2025] 177 taxmann.com 765/111 GST 645 (Delhi) (para 6)
• Eworld Business Solutions (P.) Ltd. v. Superintendent, Range 94 Central GST [2025] 178 taxmann.com 236/102 GSTL 115 (Delhi) (para 6)
• Sunrise India v. Commissioner, Delhi GST [2024] 162 taxmann.com 378/104 GST 719/87 GSTL 484 (Delhi) (para 6)
• JSD Traders LLP v. Additional Commissioner, CGST [2025] 172 taxmann.com 551/97 GSTL 160 (Delhi) (para 6)
• Ravi Parkash Goel v. Sales Tax Officer, AVATO [2024] 162 taxmann.com 840 (Delhi) (para 6)
• Akash Bansal v. Superintendent, Central GST Department, Delhi West [2025] 177 taxmann.com 518 (Delhi) (para 6)
• V R Impex v. Commissioner of Delhi GST [2025] 177 taxmann.com 492 (Delhi) (para 6)
• Oryx Fisheries (P.) Ltd. v. UOI (2010) 13 SCC 427 (para 13)
• Riddhi Siddhi Enterprises v. Commissioner of GST (CGST) [2024] 167 taxmann.com 302/90 GSTL 257 (Delhi) (para 15)
• Godrej Sara Lee Ltd. v. Excise and Taxation Officer-Cum-Assessing Authority 2023 AIR SC 781 (para 21).

The post Vague SCN Invalidates Retrospective GST Cancellation | HC appeared first on Taxmann Blog.

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Case Details: Manoj Rajaram Sharma vs. ITO [2026] 184 taxmann.com 675 (Mumbai-Trib.)

Judiciary and Counsel Details

• Pawan Singh, Judicial Member & Makarand Vasant Mahadeokar, Accountant Member
• Suryadev Yadav, Karan Hariya & Prashant Gupta, Ld. ARs for the Appellant.
• Bhagirath Ramawat, Ld. DR for the Respondent.

Facts of the Case

The assessee-individual was engaged in the activity of a Business Correspondent (BC) with a payments bank. He filed his return of income under section 44AD, declaring income at 35% of gross receipts. Based on information that certain income had escaped assessment, reassessment proceedings were initiated under section 147.

The Assessing Officer (AO) accepted gross receipts but held that income should have been computed at 50% thereof and made additions over the returned income. On appeal, the CIT(A) upheld the additions. Aggrieved by the order, the assessee filed an appeal to the Mumbai Tribunal.

ITAT Held

The Tribunal held that the assessee was engaged in business activity and was eligible for the benefit of section 44AD. The AO had not brought any material on record to demonstrate that the assessee was carrying on a specified profession as contemplated under section 44ADA. The activity of a Business Correspondent facilitating banking transactions cannot, by any stretch of interpretation, be equated with a profession such as legal, medical, engineering, architectural, accountancy, technical consultancy or other notified professions falling within the ambit of section 44AA and consequently section 44ADA.

The AO, while accepting the assessee’s gross receipts, substituted the statutory rate under section 44AD with a rate of 50%, which is traceable only to section 44ADA. Such substitution was contrary to the scheme of the Act and amounts to applying a provision which is otherwise inapplicable to the facts of the case. The assessee had declared income at approximately 35% of gross receipts, which is substantially higher than the statutory minimum prescribed under section 44AD.

Once the assessee has opted for the presumptive scheme and declared income exceeding the prescribed percentage, the AO cannot arbitrarily enhance the same unless the assessee is shown to be ineligible for section 44AD or there is material to demonstrate suppression of receipts or inflation of expenses. Therefore, the assessee’s income declared under section 44AD was to be accepted.

The post Section 44AD Applies to BC Activity Not 44ADA | ITAT appeared first on Taxmann Blog.

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Case Details: Swarnalatha J vs. Union of of India [2026] 184 taxmann.com 614 (Delhi)

Judiciary and Counsel Details

• Nitin Wasudeo Sambre & Ajay Digpaul, JJ.
• Ms Shyel Trehan, Sr. Adv., Rishabh Sharma, Rohan Poddar, Ms Vidhi Jain, Ms Ambica Sood, Rahul E., & Ms Karuvaki Mohanty, Advs. for the Petitioner.
• Piyush Beriwal, Ms Ruchita Srivastava, Ms Neha Kamboj, Dev Aaseri, Advs. & Ms Amartya Singh, Senior Panel Counsel for the Respondent.

Facts of the Case

The petitioner challenged the levy of 5% GST on clinical diapers and relied upon a representation filed before the authorities seeking exemption under Section 11 of the CGST Act and the Delhi GST Act. The said representation remained pending without any decision. The petitioner contended that clinical diapers were eligible for exemption and sought a direction for expeditious disposal of the pending representation. The Department of Revenue raised a preliminary objection regarding territorial jurisdiction. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that, without entering into the merits of the case or adjudicating the objection on territorial jurisdiction, the issue of jurisdiction was to be kept open for consideration at an appropriate stage. It directed the authorities to consider and decide the petitioner’s representation for exemption under Section 11 of the CGST Act and the Delhi GST Act, including all pleas raised, within a reasonable period, preferably within six months. The Court further held that the decision must be duly communicated to the petitioner. Accordingly, the writ petition was disposed of with liberty to the petitioner to approach again in case of an adverse decision.

The post HC Orders Decision on GST Exemption for Clinical Diapers appeared first on Taxmann Blog.

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RBI/2026-27/07 A.P. (DIR Series) Circular No. 05; Dated: 06.04.2026

The Reserve Bank of India (RBI) has decided to retain the existing limits for Foreign Portfolio Investor (FPI) investments under the General Route for the financial year 2026–27.

1. Unchanged Investment Limits

The limits continue as a percentage of the outstanding stock of securities:

• Government Securities (G-Secs) – 6%
• State Government Securities (SGSs) – 2%
• Corporate Bonds – 15%

2. Allocation Between ‘General’ and ‘Long-term’ Categories

For G-Secs, the allocation of any incremental increase in limits (in absolute terms) between sub-categories remains:

• 50% to ‘General’ category
• 50% to ‘Long-term’ category

This ensures balanced participation across investor types.

3. Treatment of SGS Limits

• The entire increase in SGS limits (in absolute terms) will be allocated to the ‘General’ sub-category
• No allocation has been made to the long-term category for SGSs

4. Fully Accessible Route (FAR)

Investments made by eligible investors in ‘specified securities’ will be:

• Counted under the Fully Accessible Route (FAR)
• Not subject to the standard FPI limits

5. Voluntary Retention Route (VRR) Alignment

• All existing and future investments under the Voluntary Retention Route (VRR) will now be subject to the overall investment limits under the General Route
• This change will be effective from 1st April 2026

6. Objective of the Framework

The RBI’s approach aims to:

• Maintain stability in debt markets
• Ensure controlled foreign participation
• Align different investment routes under a harmonised limit structure

7. Conclusion

By retaining limits and refining allocation mechanisms, the RBI ensures a balanced, stable, and transparent framework for FPI investments in debt markets, while aligning various investment routes under a unified regulatory approach.

Click Here To Read The Full Circular

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1. Introduction

In financial reporting under the Ind AS framework, fair presentation depends not just on what is reported, but also on how it is presented and disclosed. The way items are classified and whether income and expenses are shown separately or netted off play an important role in how users understand the financial statements. Even small presentation decisions, such as combining different cost elements or offsetting income and expenses, can significantly impact the interpretation of financial performance. With this background, the following case scenarios highlight common practical issues, along with an analysis of the relevant provisions and the appropriate conclusions.

2. Case Study 1

2.1 Facts – Netting of Interest Income and Interest Expense

Alpha Limited is a diversified company with significant borrowings as well as surplus funds temporarily deployed in interest-bearing instruments. During the year, the company earned interest income from its investments while simultaneously incurring interest expense on its borrowings. While preparing its Statement of Profit and Loss, the finance team of Alpha Limited decided to present a single line item reflecting “Net Finance Cost,” computed by offsetting interest income against interest expense. The management believed that such a presentation would provide a clearer picture of the company’s effective cost of funds.

This raises a critical question on whether the netting of interest income and expense in the Statement of Profit and Loss is in accordance with Ind AS.

2.2 Relevant Provisions

Ind AS 1, Presentation of Financial Statements, lays down a clear principle that income and expenses shall not be offset unless required or permitted by an Ind AS. This principle ensures that material components of financial performance are not obscured.

Further, Ind AS 107, Financial Instruments – Disclosures, emphasises the need to present information that enables users to evaluate the significance of financial instruments, which would include separate disclosure of interest income and interest expense. The Guidance Note on Division II – Ind AS Schedule III also requires finance costs and other income to be presented distinctly and does not permit such netting.

2.3 Conclusion

In the absence of any specific provision allowing offsetting in this context, the treatment adopted by Alpha Limited is not in compliance with Ind AS. The company should present interest income and interest expense separately to ensure transparency and proper understanding of its financing activities.

3. Case Study 2

3.1 Non-disclosure of Cost of Materials Consumed

Beta Manufacturing Private Limited is engaged in a dual line of business; it trades in finished goods and also operates a manufacturing facility where raw materials are processed into finished products. In its financial statements, Beta disclosed expenses under the heads “Purchases of Stock-in-Trade and Raw Material” and “Changes in Inventories of Finished Goods and Stock-in-Trade.” However, it did not present “Cost of Materials Consumed” as a separate line item, despite significant raw-material consumption in its manufacturing operations.

This raises the question of whether such aggregation of material consumption with other expense heads meets the disclosure requirements prescribed under Ind AS.

3.2 Relevant Provisions

The Guidance Note on Division II – Ind AS Schedule III to the Companies Act, 2013, specifically requires separate disclosure of “Cost of Materials Consumed” for entities engaged in manufacturing activities. The distinction is crucial as it allows users to differentiate between trading and manufacturing operations and to assess cost structures more effectively.

Ind AS 1 further supports this by requiring separate presentation of material items where such disclosure is relevant to an understanding of the entity’s financial performance.

3.3 Conclusion

By clubbing raw material consumption with purchases and inventory changes, Beta Manufacturing Private Limited has failed to provide the level of detail mandated by the Guidance Note. Accordingly, the accounting treatment is not in compliance, and the company should separately disclose the cost of materials consumed.

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