update on convergence with ifrs in india · status of ind as 115 international accounting standards...

UPDATE ON CONVERGENCE WITH IFRS IN INDIA

The Institute of Chartered Accountants of India

1

AOSSG Annual Conference Agenda Paper 17

Roadmap from Implementation on Ind ASs

Phase I (Voluntary) Phase I (Mandatory) Phase II (Mandatory)1st April 2015 or 1st April 2016 1st April 2017thereafter

2The Institute of Chartered Accountants of India


Phase I 1st April 2015 or thereafter: Voluntary Basis for all companies

1st April 2016: Mandatory Basis

a. Companies having net worth > Rs. 500 Crore (approx US$75,000,000)

b. Holding, Subsidiary, Associate and Joint Ventures of above



Phase II 1st April 2017 (mandatory basis)

a. All other Listed Companies not covered in Phase Ib. Unlisted Companies having net worth more than Rs. 250 crore

(approx US$37,000,000)

c. Holding, Subsidiary, Associate and Joint Ventures of above

Companies listed/in process of listing on SME Stock Exchangesare not required to apply Ind AS Once applicable, all subsequent financial statements to be as

per Ind ASs

Companies not covered by the above roadmap shall continue to apply existing Accounting Standards

ICAI has decided to upgrade existing Accounting Standards 4


Current status of implementation of Ind AS

ICAI formulated all the Indian Accounting Standards

Ind AS considered and approved by the NationalAdvisory Committee on Accounting Standards(NACAS)

Ind AS have been notified by the MCA as Companies(Indian Accounting Standards Rules), 2015 videNotification dated February 16, 2015. (except Ind AS11 and Ind AS 18 which are being notified)


Status of Ind AS

The Institute of Chartred Accountnst of India 6

Ind AS as on date (39 Ind AS)*

Ind AS 101- Ind AS 115 corresponding to IFRS 1- IFRS 14 (14 Ind AS)

Ind AS 1 – Ind AS 41 corresponding to IAS 1 to IAS 41 (26 Ind AS)

(Except Ind AS corresponding to IAS26, Accounting and Reporting byRetirement Benefits Plans, which is notrelevant for Companies)

2 compulsory carve outs

*All effective Interpretations (IFRICs and SICs) issued by the IFRS InterpretationCommittee have been included as Appendices in the relevant Ind AS other thanIFRIC 15

Status of Ind AS 115

International Accounting Standards Board (IASB) decidedto defer the date of effective application of IFRS 15 by oneyear to 1 January 2018

ICAI decided to :

- to defer Ind AS 115, Revenue from Contracts withCustomers

- notify Ind AS 11, Constructions Contracts and Ind AS18, Revenue

The NACAS approved drafts of Ind AS 11 and Ind AS 18alongwith the consequential amendments to other IndASs and the same are being sent to the Government fornotification

IFRIC 15 has not been included in Ind AS 18 (Revenue)7


Ind AS-converged with IFRS

• Ind AS are based on and substantially converged with IFRS Standards as issued by the IASB

• Ind AS reflects some modifications to IFRS Standards that are generally optional, only four are mandatory, and are of limited scope.

• An Appendix to each Ind AS explains 'the major differences, if any, between' the Ind AS and the corresponding IFRS Standard.


Compulsory Carve-outs

I. Bargain purchase gain arising on a business

combination (Ind AS 103, Business Combinations)

II. Classification of Foreign Currency Convertible Bonds

component as equity and not financial

liability(FCCBs) (Ind AS 32)


Steps to minimize carve-out

Efforts towards minimizing the carve-outs ascompared to those that existed in the 2011 versionof the Ind-AS standards.

ICAI is in dialogue with the IASB to eliminate theremaining carve-outs in a time bound manner


Roadmap for insurance companies, banking companies and non-banking financial companies

The roadmap for convergence of insurancecompanies, banking companies and non-bankingfinancial companies (NBFCs) is expected to beannounced by MCA in due course.

The Reserve Bank of India recommended to the MCAa roadmap for implementation of Ind AS by banksfrom 2018-19 onwards and NBFCs in a phasedmanner (2018-19 and 2019-20).


Thank You

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