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Applicability of Ind AS 115 is postponed

Applicability of Ind AS 115 is postponed

Applicability of Ind AS 115 is postponed

 Applicability of Ind AS 115 is postponed

In a relaxation that will provide immense relief to India Inc, which was grappling with the complexities of the new accounting standard on recognition of revenues in financial statements, NACAS or the National Advisory Committee on Accounting Standards has decided to defer the implementation of Ind AS 115, two sources familiar with the development told ET NOW.

“NACAS has taken a call to push back the implementation of the new standard from its original timeline of 1st April, 2016.

It will make its recommendations to the Ministry of Corporate Affairs which will then take a final call on the fresh timeline based on global cues,” said one of the sources cited earlier. Corporates and lobby bodies had earlier pushed for a two-year deferral and sought implementation by April 1st, 2018.

The recommended deferral of Ind AS 115 by NACAS follows the path chosen by the IASB (International Accounting Standards Board) and FASB (Financial Accounting Standards Board) to defer the corresponding global standards beginning 2018?

According to experts, Ind AS 115 could especially impact the financial statements of companies in the information technology, telecom, automobiles and real estate sectors and will have a bearing on several aspects including revenues, expenses, assets, liabilities and equity.

For instance, an earlier adoption of Ind AS 115 would have led to stringent disclosure requirements relating to revenue contracts for IT companies. “The IT players fear that they would be forced to disclose their order backlog, which was not simultaneously being disclosed by their global peers, said Jamil Khatri, Head of Assurance, KPMG India.

Upon adoption of Ind AS, investments in equity instruments will always be measured at fair value. This will be a big change from the current practice.

Additionally, Ind AS implementation can also lead to changes in the company’s budgeting and reporting processes, IT systems, internal control systems, income taxes and contractual arrangements.

According to Sumit Seth, Partner – Price Waterhouse & Co, “This (recommendation for deferral) will provide Indian companies with time to evaluate the new requirements and complexities under the standard, particularly in the areas of identification of multiple performance obligations in a bundled arrangement, gross vs net presentation of revenue and arrangements involving licensing of IP. Applicability of Ind AS 115 is postponed

At the same time, an option for earlier adoption of the Ind AS standard similar to the IASB’s decision will be welcomed by those companies not preferring to make accounting changes twice. It also needs to be seen as to what will be the new effective date of the standard, especially since Phase II companies will adopt Ind AS beginning April 1, 2017″. Applicability of Ind AS 115 is postponed

NACAS is a body that advises the government on the formulation and laying down of the accounting policy and standards for adoption by companies. It is currently headed by Amarjit Chopra, who was earlier the President of the ICAI or the Institute of Chartered Accountants of India. Applicability of Ind AS 115 is postponed

 

Ind AS Related all Posts :

Educational Material on Ind AS 101 First-Time Adoption of Indian Accounting Standards

Educational Material on Ind AS 102 Share Based Payment

Educational Material on Ind AS 103 Business Combinations

Educational Material on Ind AS 104 Insurance Contracts

Educational Material on Ind AS 105 Non current Assets Held for Sale and Discontinued Operations

Educational Material on Ind AS 106 Exploration for and Evaluation of Mineral Resources

Educational Material on Ind AS 107 Financial Instruments : Disclosures

Educational Material on Ind AS 108 Operating Segments

Educational Material on Ind AS 1 Presentation of Financial Statements

Educational Material on Ind AS 2 Inventories Complete Information

Educational Material on Ind AS 7 Statement of Cash Flows

Educational Material on Ind AS 8 Accounting Policies, Changes in Accounting Estimates and Errors

Educational Material on Ind AS 10 Events after the Reporting Period

Educational Material on Ind AS 11 Construction Contracts

Educational Material on Ind AS 12 Income Taxes

Educational Material on Ind AS 16 Property, Plant and Equipment

Educational Material on Ind AS 17 Leases

Educational Material on Ind AS 18 Revenue

Educational Material on Ind AS 19 Employee Benefits

Educational Material on Ind AS 20 Accounting for Government Grants and Disclosure of Government Assistance

Educational Material on Ind AS 21 The Effects of Changes in Foreign Exchange Rates

Educational Material on Ind AS 23 Borrowing Costs

Educational Material on Ind AS 24 Related Party Disclosures

Educational Material on Ind AS 27 Consolidated and Separate Financial Statements

Educational Material on Ind AS 28 Investments in Associates

Educational Material on Ind AS 29 Financial Reporting in Hyper-inflationary Economies

Educational Material on Ind AS 31 Interests in Joint Ventures

Educational Material on Ind AS 32 Financial Instruments and Presentation

Educational Material on Ind AS 33 Earnings per Share

Educational Material on Ind AS 34 Interim Financial Reporting

Educational Material on Ind AS 36 Impairment of Assets

Educational Material on Ind AS 37 Provisions, Contingent Liabilities and Contingent Assets

Educational Material on Ind AS 38 Intangible Assets

Educational Material on Ind AS 39 Financial Instruments: Recognition and Measurement

Educational Material on Ind AS 40 Investment Property

Educational Material on Difference between Ind as 27 and 21 

list of accounting standards

applicability of ind as

Ind AS – Indian Accounting Standard Complete Guide

Difference between Ind AS and existing AS 

Applicability of Ind AS 115 is postponed

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