COMPARISON OF IFRS AND INDIAN ACCOUNTING STANDARDS

The present position of Indian accounting standards has been depicted in the following comparative statements of International Financial Reporting Standards and Indian Accounting Standards. I. Indian Accounting Standards already issued by the Institute of Chartered Accountants of India (ICAI) corresponding to the International Financial Reporting Standards S. No. International Financial Reporting Standards (IFRSs)[1] No. Title of the Standard 1. IAS 1 Presentation of Financial Statements AS 1 No. Title of the Standard Disclosure Accounting Policies of AS 1 is based on the prerevised IAS 1. AS 1 is presently under revision to bring it in line with the current IAS 1. The Exposure Draft of the revised AS 1 is being finalised on the basis of the comments received on its limited the exposure specified amongst Indian Accounting Standards (ASs) Major Differences

outside bodies. The major differences between IAS 1 and the draft revised AS 1 are discussed hereinafter. Differences due to

removal of alternatives 1. Unlike IAS 1, the draft of revised provide AS any 1 does not with option

regard to the presentation of Statement of Changes in Equity. It requires

statement presented. The IASB

showing

all

changes in the equity to be

has

recently

issued an Exposure Draft of the proposed Amendments to IAS 1. The Exposure Draft proposes to remove the option given in IAS 1 and to require the presentation of statement showing all changes in the equity which is in line with the decisions taken by the ASB of the ICAI. 2. Unlike IAS 1, the draft of revised provide regard capital, shares nature AS any to e.g., 1 does not with option

additional number of

disclosures regarding share authorised, and issued, of

fully paid, etc. and regarding purpose reserves, etc., to be made on the face of the balance sheet or in the the notes. of Considering the information overload, draft revised AS 1 requires this information to be presented only in the notes and schedules and not on the face of the balance sheet. Differences due to legal and environment regulatory

3.

In

India, the

the

laws and

governing banking insurance prescribe

companies, enterprises

enterprises detailed

formats

for the financial statements to be followed by respective enterprises. To make the revised AS 1 acceptable to the law makers/ regulators, the ASB has decided to give detailed formats for financial statements for companies in an Appendix. In the Appendix, mainly additional disclosures as compared to IAS 1 are proposed to be given. 4. IAS 1 uses the expression present fairly whereas draft of revised AS 1 uses the expression true and fair in view of the various laws requiring ensure that the the relevant financial entities and the auditors to statements give a true and fair view. Conceptual Differences 5. IAS 1 requires that if

different classes should of be

measurement assets, presented they as

bases are used for different

separate line items on the face of the balance sheet. It is felt that requiring

bifurcation of assets on the basis of different measurement bases on the face of the balance sheet itself would result in information draft revised require of AS the 1 overload. proposed does not separate

Keeping this in view, the

presentation of such assets on the face of the balance sheet; rather, it requires of separate presentation

such assets to be made in the schedules and notes. Note Recently ICAI has published IAS. 2. IAS 2 Inventories AS 2 Valuation Inventories of AS 2 is based on IAS 2 (revised 1993). IAS 2 has been revised in 2003 as a part of the IASBs improvement project. Major differences between AS 2 and IAS 2 (revised 2003) are as follows: Differences due to level of preparedness 1. IAS 2 specifically deals with costs of inventories of an in enterprise view the providing level that of was services. However, keeping understanding exposure draft which is broadly on lines of

prevailing in the country regarding the treatment of inventories of an enterprise providing services at the time of last revision of AS 2, the same are excluded from the scope of AS 2. 2. Keeping in view the level of preparedness of AS in 2, AS the 2 country at the time of last revision requires lesser disclosures as compared to IAS 2. 3. IAS provides of of who the 2 specifically that Standard do held the not by their

measurement requirements apply to the measurement inventories measure commodity broker-traders

inventories at fair value less costs to sell. AS 2 does not contain to any exclusion held are or or by separate provisions relating inventories commodity broker-traders. (Broker-traders who buy those sell

commodities for others or on their own account. The inventories are principally acquired by a broker-trader with the purpose of selling in the near a in future profit price and from or generating fluctuations

broker-traders margin.) By

implication, measurement lower of cost of basis and

the laid net

down in the Standard, viz., realisable value, applies to inventories commodity trader-brokers. Conceptual differences 4. AS excludes cost of 2 specifically selling Inventories that to it and and is

distribution costs from the provides appropriate

recognise

them as expenses in the period in which they are incurred. However IAS 2 excludes Costs. 5. AS 2 does not deal with the issues of relating to recognition inventories only Selling Costs and not Distribution

as an expense including the write down of inventories to net realisable value and any reversal down. 6. AS 2 provides that the cost of inventories of items other than those which are not ordinarily interchangeable and goods or services produced and segregated for specific projects should be assigned by using the first-in, firstout (FIFO), or weighted average cost formula. It is specifically required by AS 2 that the formula used of such write

should the

reflect cost

the fairest in of

possible approximation to incurred the and items bringing location

inventory to their present condition. However IAS 2 does not require the same for the choice of the formula to be used, rather it requires that same cost formula should be used for all inventories having a similar nature and use to the entity.

3.

Corresponding IAS has been withdrawn since the matter is now covered by IAS 16 and IAS 38

AS 6

Depreciation Accounting

AS 6 was formulated on the basis of IAS 4, Depreciation Accounting, which has since been withdrawn. Standard for being The Indian (AS) Fixed corresponding Accounting Assets, is 10, Accounting

revised to

bring it in line with IAS 16. The Council has approved the draft of the revised AS 10 and the same will be issued 10, AS shortly. 6 would Upon be issuance of the revised AS withdrawn. 4. IAS 7 Cash Flow AS 3 Cash Statements Flow AS 3 is based on the current IAS 7. The major differences between IAS 7 and AS 3 are as below: Differences due to

Statements

removal of alternatives 1. In case of enterprises

other 3 does

than not with It to

financial provide regard of any to

enterprises, unlike IAS 7, AS option paid. paid

classification be

interest as

requires interest classified

financing cash flows. 2. In other provide interest received. interest case of enterprises financial option with

than any and It and

enterprises, AS 3 does not regard to classification of dividend requires dividend

received to be classified as investing cash flows. 3. AS provide regarding 3 also any does not of

option It requires

classification

dividend paid.

dividend paid to be classified as financing cash flows.

5.

IAS 8

Accounting Policies, Changes Accounting Estimates Errors and in

AS 5

Net Loss

Profit for

or the Prior

AS 5 is based on the earlier IAS 8. AS 5 is presently under revision to bring it in line with the current IAS 8. The exposure draft of the revised AS 5 is being prepared on the basis of the comments received on its limited exposure among the specified outside bodies. There is no major difference between IAS 8 and the draft

Period, Period Accounting Policies

Items

and Changes in

revised standard. 6. IAS 10 Events the After Balance AS 4 Contingencies and Occurring the Sheet Date Events after Balance AS 4 is based on the prerevised IAS 10 which dealt with the Contingencies as well as the Events Occurring After the Balance Sheet Date. Recently, on the lines of IAS 37, the ICAI has issued AS 29. Pursuant to the issuance of 29, the portion of AS 4 dealing with the Contingencies, except to the extent of impairment of assets not covered by other accounting stands After Date. standards, AS 4 superseded. the AS Balance 4 is

Sheet Date

now deals with the Events Sheet presently

under revision to bring it in line with the corresponding IAS 10. Difference due to legal and environment 1. As per IAS 10, proposed dividend is a non-adjusting event. However, as per the Indian proposed required greater the to law governing for is companies, provision dividend be regulatory

made, of

probably as a measure of accountability company concerned

towards investors in respect of payment of dividend.

While attempts are made, from the time to time, at for various levels, to persuade Government changes in law; it is a timeconsuming process. 2. As per IAS 10, non-

adjusting events, which are material, are required to be disclosed in the financial statements. However as per AS 4, such disclosures are required to be made in the report of the approving authority and not in the financial statements. 7. IAS 11 Construction Contracts AS 7 Construction Contracts AS 7 is based on the current IAS 11. There is no difference between AS 7 and IAS 11. 8. IAS 12 Income Taxes AS 22 Accounting Taxes Income for on Differences due to level of preparedness Keeping in view the level of preparedness in the country at the time of issuance of AS 22, AS 22 was based on the Income Approach. ICAI is revising AS 22 to bring it in line with IAS 12. 9. IAS 14 Segment Reporting AS 17 Segment Reporting AS 17 is based on the Statement

current IAS 14. The major differences between IAS 14 and AS 17 are described

hereinafter. Differences due to

removal of alternatives 1. IAS 14 encourages, but does not require, of activities the as reporting integrated separate vertically segments.

However, under AS 17, in case a vertically integrated segment quantitative being segment, be made. 2. As per IAS 14, as a a segment identified a the meets norms the for

reportable relevant

disclosures are required to

reportable segment in the immediately period relevant on 10% preceding satisfying the threshold,

shall be reportable segment in the current period also if the management judges it to be of continuing However as significance. mandatory considering

per AS 17, this reporting is without the

managements judgement Differences due to level of preparedness 3. IAS 14 prescribes certain additional requirements disclosure regarding

enterprises share of profit or loss of associates and joint regarding ventures restatement and of

prior year information, etc.

At the time of issuance of AS India in 17, there dealing and were no in with joint Accounting Standards

accounting for investments associates ventures, etc. Accordingly, these disclosures are not specifically covered in AS 17. 4. As per IAS 14, for a segment to qualify as a reportable segment, it is required for it to earn the majority of its revenue from external addition customers to meeting in the

10% threshold criteria of revenue, operating results or total assets required in AS 17. The IASB has which 2009. ICAI the recently would The would above issued IFRS 8 on Operating Segments from ASB supersede IAS 14 with effect January of the

consider

differences between AS 17 and IAS 14 while revising its AS 17 to bring it in line with IFRS 8 on Operating Segments. 10. IAS 16 Property, Plant and Equipment AS 10 Accounting Fixed Assets for AS 10 is based on the earlier IAS 16. AS 10 is being revised to bring it in line with the current IAS 16. The draft revised AS 10 has been approved by the Council and will be issued shortly. The following are

the

major

differences

between IAS 16 and draft revised AS 10: Differences due to legal and environment 1. In India, the the law governing of 10 companies Keeping that rates the minimum regulatory

prescribes minimum rates depreciation. recognises this in view, the revised AS depreciation would be

prescribed by the statute rates of depreciation. Conceptual differences 2. As per IAS 16, all

servicing except used only in

equipments, servicing connection

whether major or minor, equipments which can be with an item of property, plant and equipment, are carried as inventory and recognised in the statement of profit and loss, when consumed. equipments used only that in Servicing can be connection

with an item of property, plant and equipment are accounted for as property, plant and equipment. Keeping in view the nature of servicing equipments as separate assets, draft of

the

AS

10 all

(revised) servicing plant and

requires as

equipments to be treated property, equipment. 11. IAS 17 Leases AS 19 Leases AS 19 is based on IAS 17 (revised 1997). IAS 17 has been revised in 2004. The major differences between IAS 17 and AS 19(revised 2004) are described hereinafter. Conceptual differences 1. in Keeping the in view the lease from peculiar land lease practices country, excluded agreements to use lands are specifically the scope of AS 19 whereas IAS 17 does not contain this exclusion. 2. IAS 17 specifically provides that the Standard shall not be applied as the basis of measurement for: (a) property lessees accounted held that for by is as

investment property; (b) investment provided under leases; (c) biological assets held by lessees under finance leases; or by property lessors operating

(d) biological provided by

assets lessors

under operating leases However AS 19 does not exclude the above from its scope. 5. AS 19 specifically prohibits upward revision in estimate of unguaranteed residual value during the lease term. However IAS 17 does not prohibit the same. 6. As per IAS 17 initial other than or of a direct costs incurred by a lessor manufacturer in amount dealer lease

lessor have to be included receivable in the case of finance lease resulting in reduced amount of income to be recognised over lease term and in the carrying amount of the asset in the case of operating lease as to expense it over the lease term on the same basis as the lease income. However as per AS 19, these can be either charged off at the time of incurrence in the statement of profit and loss or can be amortised over the lease period. 12. IAS 18 Revenue AS 9 Revenue Recognition AS 9 is based on the earlier IAS 18. AS 9 is presently under revision to bring it in line with the current IAS 18. 13. IAS 19 Employee Benefits AS 15 Employee Benefits AS 15 is based on the

current IAS 19. The major

differences between IAS 19 and AS 15 are described hereinafter. Difference due to

removal of alternatives 1. Unlike IAS 19, AS 15 does not provide any option with regard to recognition of actuarial It and gains to and such be losses. gains requires losses

recognised immediately in the statement of profit and loss. Conceptual Difference 2. Regarding recognition of benefits as a termination

liability, it is felt that merely on the basis of a detailed formal plan, it would not be appropriate to recognise a provision crystallised since at a this liability stage. cannot be considered to be Accordingly, AS 15 provides criteria for recognition of a provision respect general per AS for of liability in termination criteria for

benefits on the basis of the recognition of provision as 29, Provisions, Liabilities and to Contingent Contingent Assets (corresponding IAS 37). It may be noted that the IASB has recently issued an Exposure proposed Draft of the to Amendments

IAS 19 whereby the criteria regarding termination amended. Draft voluntary benefits recognition benefits The proposes should as of a

liability are proposed to be Exposure that be termination

recognised when employees accept the entitys offer of those benefits. We, in our comments on the Exposure Draft, have pointed out that in a country such as India, such a requirement would give erroneous results since the schemes generally have the following characteristics in terms in of the steps involved implementing

the scheme: (i) Announcement of the

scheme by an employer, which is considered as an invitation to offer to the employees rather than the offer to the employees for voluntary (ii) termination of their services. Employees This tender does to not the the claim In their applications under the scheme. confer scheme termination employees any right under to benefits.

other words, tendering of application by an employee is considered as an offer in response to invitation to

offer,

rather

than

acceptance of the offer by the employee. (iii) offer The acceptance of the made by the

employees as per (ii) above by the management. Keeping in view the above, we have suggested that as per the above with scheme, regard to be accepts liabilities voluntary benefits the

termination should

recognized at the time when management the offer of the employees rather than at the time the employees tender their applications in response to the invitation to offer made by the management. If our comments Draft the IAS 19 on the are would

Exposure accepted, criteria in

amended

result into recognition of the liability broadly at the same time as under the criteria prescribed in AS 15. Incidentally, mentioned it may be the

that

treatment prescribed in AS 15 is also in consonance with the legal position in India. 14. IAS 20 Accounting for Government AS 12 Accounting Government for AS 12 is being revised to bring it in line with IAS 20.

Grants Disclosure

and of

Grants

Government Assistance

The Exposure Draft of the proposed revised AS 12 has been issued for public comments There is no major difference between the Exposure Draft of the standard and IAS 20.

15.

IAS 21

The Effects of Changes Foreign Exchange Rates in

AS 11

The

Effects

of in

Difference due to level of preparedness 1. AS 11 is based on the and non-integral operations i.e., which the was integral foreign approach, approach

Changes Foreign

Exchange Rates

followed in the earlier IAS 21 (revised 1993). 2. The current IAS 21, is based gives on similar Currency which

Functional approach,

results as that under prerevised IAS 21, which was based on integral /nonintegral foreign operations approach. there are no Accordingly, significant

differences between IAS 21 and AS 11. 3. The current AS 11 has recently become effective, i.e., from 1-4-2004. It is felt that some experience should 21. 16. IAS 23 Borrowing Costs AS 16 Borrowing Costs There is no major difference between AS 16 and IAS 23 (revised 2007). 17. IAS Related Party AS Related Party AS 18 is based on IAS 24 (reformatted 1994) and be gained before shifting to the current IAS

24

Disclosures

18

Disclosures

following differences two.

are

the

major the

between

Conceptual differences 1. as According to AS 18, notified by a not a of the nona be key by

Government, executive company considered management

director should as

person

virtue of merely his being a director unless he has the authority and responsibility for planning, directing and controlling the activities of the reporting enterprise. However, IAS 24 provides for including non-executive director in key management personnel. 2. In AS 18 the term son, who daughter, may by, the be that reporting whereas the relative is defined as the spouse, mother influenced with brother, sister, father and expected to influence, or be individual in his/her dealings enterprise

comparable concept in IAS 36 is that of close members of the family of an individual who are those family members who may be expected to influence, or be influenced by, that individual in their dealings with the entity. They may include: (a) the individuals

domestic partner and

children; (b) children individuals partner; and (c) dependants of the of the

domestic

individual or the individuals domestic partner. 18. IAS 27 Consolidated and Separate Financial Statements AS 21 Consolidated Financial Statements AS 21 is based on IAS 27 (revised made to 2000). IAS Revisions 27/IAS 27

R are being looked into by the ASB of the ICAI. Difference due to legal and environment 1. Keeping in view the of the law the of companies, more or than as requirements governing ownership of an regulatory

AS 21 defines control as one-half of the voting power enterprise control over the composition of the governing body of an enterprise so as to obtain economic IAS 27, the benefits. which This defines and an definition is different from control as the power to govern financial of operating policies

enterprise so as to obtain benefits from its activities. Conceptual Differences 2. makes AS 21, at present, to AS for for an reference

13, Accounting the accounting

Investments, with regard to

investment in a subsidiary in the separate On the Standard of financial the 30 and Keeping proposed statements. issuance Accounting on Financial Recognition stand withdrawn.

Instruments:

Measurement, AS 13 would this in view, the Exposure Draft for the limited revision to AS 21, which has recently been issued, proposes to for include the IAS accounting separate 27

investment in subsidiary in financial the statements in AS 21. provides following two options with regard to accounting for an investment in a subsidiary: (i) (ii) at cost; or in accordance with

IAS 39. When an investment in a subsidiary is accounted for in accordance with IAS 39, the same is included in the available for sale category. The ASB of the ICAI is of the view that keeping in view the nature for and specific an objective which

investment in a subsidiary is acquired, it is not correct to include such investment in the same at available-for-sale fair value. 27, category and measure the Therefore, unlike IAS

draft for limited exposure to AS 21, does not provide any option with regard to the

accounting the such separate

for

an financial requires to be

investment in a subsidiary in statements. It

investments

valued at cost only. 19. IAS 28 Investments in Associates AS 23 Accounting Investments Associates Consolidated Financial Statements for in in AS 23 is based on the IAS 28 (revised 2000). Revisions made to IAS 28 are being looked into by the ASB of the ICAI. Conceptual Differences The conceptual differences, explained in relation to IAS 27, are relevant in this case also. 20. IAS 31 Interests in AS 27 Financial Reporting Interests Joint Ventures of in AS 27 is based on the IAS 31 (revised 2000). Revisions made to IAS 31 are being looked into by the ASB of the ICAI. Difference 1. due to removal of alternatives Unlike IAS 31, AS 27 does not provide any option for accounting of interests in jointly controlled entities in the It consolidated requires financial statements of the venturer. proportionate consolidation to be followed and venturers share of each of the assets, liabilities, income and expenses of a jointly controlled entity to be reported as separate line items. Conceptual differences The conceptual differences, explained in relation to IAS 27, are relevant in this case

Joint Ventures

also. 21. IAS 33 Earnings Share Per AS 20 Earnings Share Per AS 20 is based on the IAS 33 (issued 1997). Revisions made to IAS 33 are being looked into by the ASB of the ICAI. Differences due to level of preparedness 1. As per IAS 33 revised, basic and diluted amounts per share for the discontinued operation are required to be disclosed. However AS 20 does not require such disclosures. 2. IAS 33 revised requires the disclosure of antidilutive instruments also which is not required by AS 20. 22. IAS 34 Interim Financial Reporting AS 25 Interim Financial Reporting AS 25 is based on the

current IAS 34. The major differences between IAS 34 and AS 25 are described hereinafter. Differences due to legal and environment 1. In India, at present, the statement of changes in equity is not presented in the annual financial statements since, as per the law, this information is required to disclosed partly in the profit and loss account below the line and partly in the balance sheet and schedules thereto. Keeping this in view, unlike IAS 34, AS 25 presently regulatory

does condensed as a

not of

require the of

presentation

statement of

changes in equity. However result proposed revision to AS 1, limited revision to AS 25 has also been requires proposed, to which the of present statement

condensed condensed statements been made.

changes in equity as part of financial and limited

exposure for the same has 2. Keeping in view the legal and regulatory requirements prevailing in India, AS 25 provides that in case a statute requires or a an regulator

enterprise to prepare and present interim information in a different form and/or contents, then that format has and to be the followed. recognition However,

measurement

principles as laid down in AS 25 have to be applied in respect of such information. 23. IAS 36 Impairment Assets of AS 28 Impairment Assets of AS 28 is based on the IAS 36 (issued 1998). At the time of issuance of AS 28, there was no major difference between AS 28 and IAS 36. IASB, pursuant to its project on Business Combinations, has made certain changes in IAS relate 36 to which the are clarificatory in nature and/or Intangible

Assets having indefinite life. 24. IAS 37 Provisions, Contingent Liabilities Contingent Assets and AS 29 Provisions, Contingent Liabilities Contingent Assets and AS 29 is based on the

current IAS 37. The major differences between IAS 37 and AS 29 are described hereinafter. Difference due to level of preparedness 1. AS 29 requires that the of a provision since in amount its

should not be discounted to present are value financial India statements

prepared

generally on historical cost basis and not on present value limited basis. However is a revision being

proposed to bring it in line with IAS 39 insofar as this aspect is concerned. Conceptual Differences 2. IAS 37 deals with in of constructive provision. basis cases, of obligation effect

the context of creation of a The recognising provision on the constructive will be obligation is that, in some provision required to be recognised at an early stage. For example, in case of a restructuring, a constructive obligation arises when an enterprise has a detailed formal plan for the restructuring and the enterprise has raised a valid expectation in those affected that it will carry out the restructuring by starting

to implement that plan or announcing its main features to those affected by it. It is felt that merely on the basis of a detailed and it formal plan thereof,

announcement

would not be appropriate to recognise a provision since a liability cannot be considered to be crystalised at this stage. Further, the judgment management whether has the raised

valid expectations in those affected may be a matter of considerable argument. In view of the above, AS 29 does with obligation. however, not specifically AS requires deal 29, a constructive

provision to be created in respect of obligations arising from practice, desire an to normal custom business and a good In

maintain

business relations or act in equitable manner. such cases, general criteria for recognition of provision are required to be applied. Incidentally, mentioned it may be the that

treatment prescribed in AS 29 is also in consonance with the legal position in India. 3. Unlike IAS 37, as a measure of prudence, AS 29 does not require contingent assets to be disclosed in the financial statements.

25.

IAS 38

Intangible Assets

AS 26

Intangible Assets

AS 26 is based on IAS 38 (issued 1998). IASB, as a part of its IAS project on Business Combinations, has revised 38.These revisions to IAS 38 would be looked into by the ASB with the issuance of the Accounting on Business Following are Standard Combinations. the major

differences between AS 26 and IAS 38: Conceptual Differences 1. An defined intangible as an asset is

identifiable asset, in supply or the of for

non-monetary held for use or

without physical substance, production to

goods or services, for rental others, administrative intangible identifiable asset substance. 2. AS 26 is based on the assumption that the useful life of the intangible asset is always definite. In regard to assets with definite life also there is a rebuttable presumption that the useful life of an intangible asset will not exceed ten years from the date when the asset is available for use. asset purposes as an

whereas IAS 38 defines an non-monetary physical

without

Whereas IAS 36 recognises that an intangible asset may have an indefinite life. In respect of intangible assets having a definite life, the Standard does not contain rebuttable presumption about their useful life. 3. As per AS 26 if control over the future economic benefits from an intangible asset is achieved through legal rights that have been granted for a finite period, it is required that the useful life of the intangible asset should unless: (a) the legal rights are not exceed the period of the legal rights

renewable; and (b) renewal certain. However, IAS 38 requires evidence to support renewal instead of virual certainty for renewal. AS 13 was formulated on the basis of Pursuant IAS for to 25, Accounting Investments. is virtually

26.

Corresponding IAS has been withdrawn since the matter is now covered by IAS 32, 39, 40 and

AS 13

Accounting Investments

for

the issuance of IAS 32, IAS 39, IAS 40 and IFRS 7, IAS 25 has been superseded. The Exposure Drafts of the

IFRS 7

proposed Indian Accounting Standards corresponding to IAS 39 and IAS 32 have been broadly issued in which with will the supersede AS 13, which are line corresponding IASs

27.

IAS 40

Investment Property

Dealt

with

by

AS 13 was formulated on the basis of Pursuant IAS for to 25, Accounting Investments.

Accounting Standard 13

the issuance of IAS 32, IAS 39 and IAS 40, IAS 25 has been superseded. The proposed Indian Accounting Standard corresponding to IAS 39 and IAS 40 is under preparation. 28. IFRS 3 Business Combinations AS 14 Accounting for AS 14 on was the

Amalgamations

formulated 22, Business

basis of earlier IAS Combinations. Pursuant to the issuance of IFRS 3, Business Combinations, IAS 22 has superseded. AS 14 is presently under been

revision to bring it in line with the IFRS 3. 29. IFRS 5 Non-current Assets Held for Sale Operations and Discontinued AS 24 Discontinuing Operations. Further, AS 10 deals accounting fixed retired with for from assets based AS on 24 the is IAS

35, Discontinuing Operations, has which been

superseded pursuant to the issuance of IFRS 5, Non-current Assets Held for Sale

active use.

and

Discontinued An Indian to under The in with the of this

Operations. Accounting Standard corresponding IFRS 5 is preparation. which consonance IFRS 5. Indian proposed withdrawn. II. International Financial Reporting Standards not considered relevant for issuance of Accounting Standards by the ICAI for the reasons indicated. S. No. No. 1. IAS 29 International Financial Reporting Standard Title of the Standard Financial Economies Reporting in Reasons Hyper-inflationary conditions do not After issuance is

first draft is ready

accounting to be

standard, AS 24 is

Hyper-inflationary

prevail in India. Accordingly, the subject is not considered relevant in the Indian context.

2.

IFRS1

First-time

Adoption

of

In India, Indian ASs are being adopted since last many years and IFRSs are not being adopted for the first time. Therefore, the IFRS 1 is not relevant to India at present.

International

Financial

Reporting Standards

III.

Accounting Standards presently under preparation corresponding to the International Financial Reporting Standards

S. No.

International Financial Reporting Standards No. Title of the Standard

Status of the corresponding Indian Standard

1.

IAS 26

Accounting Reporting Retirement Plans

and by Benefit

Under Preparation.

2.

IAS 32

Financial Instruments: Presentation

Note ICAI has already issued

AS 31 which is mandatory w.e.f. April 1, 2011. Differences due to legal and regulatory environment The Exposure Draft of proposed Standard does not deal with certain aspects which are not permitted under the present Indian legal framework, for example, derivatives based on an enterprises own equity instruments and buy back of shares by the enterprise itself for issuance to employees under ESOPs. As per IAS 32, redeemable preference shares, based on their substance, may be considered as a debt instrument instead of equity instrument. In Indian legal framework, the settled position is to consider these as part of equity. ICAI has decided to retain IAS 32 position in the Exposure Draft of proposed Indian Accounting Standard. However, it is recognised in the Exposure Draft itself that until the law is amended, the law will prevail over the Standard.

3.

IAS 39

Financial Instruments: Recognition and

Note ICAI has already issued AS 30 which is mandatory w.e.f. April 1, 2011. There are no major differences compared

Measurement 4. IAS 41 5. IFRS 2 Share-based Payment Agriculture

to IAS 39. Under preparation.

Under preparation. At present, Employeeshare Based Payments, are covered by a Guidance Note issued by the ICAI, which is based on IFRS 2 insofar as fair value approach is concerned. It, however, allows adoption of intrinsic value method until the formulation of the Standard. Further, some other pronouncements payments, deal with AS other 10, share-based e.g.,

Accounting for Fixed Assets. 6. IFRS 4 7. IFRS 7 Financial Instruments: Disclosures Note ICAI has already issued AS 32 which is mandatory w.e.f. April 1, 2011. Insurance Contracts Under preparation.

IV.

Guidance Note issued by the Institute of Chartered Accountants of India (ICAI) corresponding to the International Financial Reporting Standard

S. No

International Financial Reporting Standard No. Title of the Standard Exploration Evaluation Resources for of and Mineral

Title of the Guidance Note

1.

IFRS 6

Guidance Note on Accounting for Oil and Gas Producing Activities. The Guidance Note is comprehensive as it deals with all accounting aspects and is based on the corresponding US GAAPs.

[1]

It may be noted that International Accounting Standards nos. 3, 4, 5, 6, 9, 13, 15, 22, 25, 30 and 35 have already been withdrawn by the International Accounting Standards Board (IASB).