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Important Stuff on Ind AS 29, Financial Reporting in Hyperinflationary Economies

Indian Accounting Standard (Ind AS) 29, Financial Reporting in Hyperinflationary Economies, Important Material

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Ind AS 29: Financial Reporting in Hyperinflationary Economies

Hyperinflation means extremely fast or out-of-control inflation. In a hyperinflationary economy, reporting of operating results and financial position in the local currency without restatement is not useful. Money loses purchasing power at such extant that comparison of amounts from transactions and other events that have occurred at different times, even within the same accounting period, will be misleading.


This Standard deals with the measurement problems of entities that are reporting in the currency of a hyperinflationary economy. In this situation, financial information reported in historical terms would present a distorted picture of the entity’s performance and financial position. This Standard sets out procedures for adjusting the financial information for the effects of hyperinflation.

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