AS vs IND AS (Old vs New Indian Accounting Standards)

Indian Accounting Std (old)

vs

IND AS (New)

CA Sandesh Mundra

www.consolidationofaccounts.com

Console ™
Lets Automate Consolidation……..

• We have developed a software to automate
the process of preparation of consolidated
financial statements.
• To check out the same visit
http://www.slideshare.net/sandeshmundra/c
onsole-13130822

CA Sandesh Mundra


Consolidation Process
One time
activity

Currency
Adjustment
Fixed Assets
Schedule

JV Proportion

LBLA

Setup
Master

Minority

Goodwill

Consolidation
Intra Group
Transactions

Equity Impact

Upload
Trial
Balances

Balance
Sheet

Accounting Policies
Adjustment

CA Sandesh Mundra


Profit and
Loss Account

Overview of Significant
Differences between IND AS and
Current Indian GAAP

CA Sandesh Mundra


TOPICS COVERED

Differences with respect to:
• Conceptual Accounting Framework
• Accounting Differences
• Carve Outs

CA Sandesh Mundra


ACCOUNTING FRAMEWORK
Historical cost
IFRS:
Historical cost, but intangible assets, property plant and equipment (PPE) and
investment property may be revalued. Derivatives, biological assets and most
securities must be revalued.
Indian GAAP:
Historical cost, but fixed assets, other than intangibles, may be revalued.

CA Sandesh Mundra


ACCOUNTING FRAMEWORK
First-time adoption of accounting frameworks
IFRS:
Full retrospective application with some optional exemptions.

Indian GAAP:
particular standards specify the transitional treatment upon the first-time
application of those standards

CA Sandesh Mundra


LIST OF IND AS, IFRS AND AS

CA Sandesh Mundra


Ind AS

IFRS

AS

Ind AS 1 Presentation
of Financial
Statements

IAS 1 Presentation of
Financial Statements

AS 1 Disclosures of
Accounting Principles
and Policies

Ind AS 2 Inventories

IAS 2 Inventories

AS 2 Valuation of
Inventories

Ind AS 7 Statement of
Cash Flows

IAS 7 Statement of Cash
Flows

AS 3 Cash Flow
Statements

Ind AS 8 Accounting
Policies, Changes in
Accounting Estimates
and Errors

IAS 8 Accounting
AS 4 Contingencies and
Policies, Changes in
Events occurring after
Accounting Estimates and Balance Sheet Date
Errors

Ind AS 10 Events after
the Reporting Period
Ind AS 10 Appendix A

IAS 10 Events after the
Reporting Period
IFRIC 17 Distribution of
Non-cash Assets to
owners

AS 5 Net Profit or Loss for
the period, Prior Items
and Changes in
Accounting Policies

Ind AS 11 Construction
Contracts
(deferred)
Ind AS 11 Appendix B
(deferred)

IAS 11 Construction
AS 7 Construction
Contracts
Contracts
IFRIC 12 Service
Concession Arngmt
SIC 29 Disclosure – Service
Concession Arrangements

Ind AS 12 Income Taxes

IAS 12 Income Taxes
AS 22 Accounting for Taxes
on Income
SIC 21 Income Taxes –
Recovery of Revalued NonDepreciable Assets
SIC 25 Income Taxes –
Changes in the Tax Status
of an Enterprise or its
Shareholders


Ind AS 16 Property, Plant
and Equipment

IAS 16 Property, Plant and
Equipment

AS 10 Accounting for Fixed
Assets
AS 6 Depreciation
Accounting


IFRIC 1 Changes in Existing
Decommissioning, Restoration
and Similar Liabilities

Ind AS 17 Leases

IAS 17 Leases
AS 19 Leases
SIC 15 Operating Leases –
Incentives
SIC 27 Evaluating the Substance of
Transaction involving the Legal
Form of a Lease
IFRIC 4 Determining Whether an
Arrangement contains a Lease


Ind AS 17 Appendix C
(Deferred)
Ind AS 18 Revenue

Ind AS 18 Appendix C

IAS 18 Revenue
AS 9 Revenue
Recognition
SIC 31 Revenue – Barter
Transactions Involving Advertising
IFRIC 13 Customer Loyalty
Programmes
IFRIC 18 Transfer of Assets from
Customers

Ind AS 19 Employee
Benefits

Ind AS 19 Employee
Benefits

AS 15 Employee Benefits

Ind AS 20 Accounting For
Government Grants and
Disclosure of Government
Assistance
Appendix A Government
Assistance – No Specific
Relation in Operating
Activities

Ind AS 20 Accounting For
Government Grants and
Disclosure of Government
Assistance
Appendix A Government
Assistance – No Specific
Relation in Operating
Activities

AS 12 Accounting for
Government Grants

Ind AS 21 The Effects of
Changes in Foreign
Exchange Rates

Ind AS 21 The Effects of
Changes in Foreign
Exchange Rates

AS 11 The Effects of
Changes in Foreign
Exchange Rates

Ind AS 23 Borrowing Costs

Ind AS 23 Borrowing Costs

AS 16 Borrowing Costs

Ind AS 24 Related
Party Disclosure

IAS 24 Related Party Disclosure

AS 18 Related Party
Disclosures

No Near Final Draft

IAS 26 Accounting and
Reporting by Reporting by
Retirement Benefits Plans

No standard

Ind AS 27 / IFRS 10
Consolidated and
Separated Financial
Statements
Ind AS 27 Appendix
A

IAS 27 Consolidated Separated
and Financial Statements

AS 21 Consolidated Financial
Statements

SIC 12 Consolidation – Special
Purpose Entities

Ind AS 28 Investment IAS 28 Investment in Associates
in Associates

AS 23 Accounting for
Investments in Associates in
Consolidated Financial
Statements

Ind AS 29 Financial
Reporting in
Hyperinflationary
Economies
Ind AS 29 Appendix
A

No standard

IAS 29 Financial Reporting in
Hyperinflationary Economies
IFRIC 7 Applying the
Restatement Approach under
IAS 29 Financial Reporting in
Hyperinflationary Economies

Ind AS 31 Interest in Joint
Ventures / IFRS 11

IAS 31 Interest in Joint Ventures

Ind AS 32 Financial
Instruments: Presentation

IAS 32 Financial Instruments:
Presentation

AS 31 Financial
Instruments :
Presentation

Ind AS 33 Earning Per
Share

IAS 33 Earning Per Share

AS 20 Earnings per Share

Ind AS 34 Interim
Financial Reporting

IAS 34 Interim Financial
Reporting

AS 25 Interim Financial
Reporting

SIC 13 Jointly Controlled Entities
– Non-Monetary Contributions
by Venturers

AS 27 Financial
Reporting of Interests in
Joint Ventures

IFRIC 10 Interim Financial
Reporting and Impairment.
Ind AS 36 Impairment Of
Assets

IAS 36 Impairment Of Assets

AS 28 Impairment of
Assets

Ind AS 38 Intangible
Assets
Ind As 38 Appendix A

IAS 38 Intangible Assets

AS 26 Intangible Assets

SIC 32 Intangible Assets –
Website Costs

Ind AS 37 Provisions,
Contingent Liabilities
and Contingent Assets


Ind AS 39 Financial
Instruments :
Recognition and
Measurement
Ind AsS39 Appendix C
Ind AS 39 Appendix D
Ind AS 39 Appendix E

IAS 37 Provisions, Contingent
Liabilities and Contingent Assets

AS 29 Provisions, Contingent
Liabilities and Contingent
Assets

IFRIC 5 Rights to Interest Arising
from Decommissioning,
Restoration and Environmental
Rehabilitation Funds
IFRIC 6 Liabilities Arising from
Participating in a Specific Market
– Waste Electrical and Electronic
Equipment
IAS 39 Financial Instruments :
Recognition and Measurement
IFRIC 9 Reassessment of
Embedded Derivatives
IFRIC 16 Hedges of a net
Investment in Foreign Operation
IFRIC 19 Extinguishing Financial
liabilities with Equity
instruments

AS 30 Financial Instruments
: Recognition and
Measurement

Ind AS 40 Investment
Property

IAS 40 Investment Property

No standard

No near Final Draft

IAS 41 Agriculture

No standard

Ind AS 101 First Time
Adoption of Indian
Accounting Standards

IFRS 1 First Time Adoption
of International Financial
Reporting Standards

No standard

Ind AS 102 Share Based
Payment

IFRS 2 Share Based Payment

No standard

Ind AS 103 Business
Combination

IFRS 3 Business
Combination

No standard

Ind AS 39 Insurance
Contracts

IFRS 4 Insurance Contracts

No standard

Ind AS 105 Non-Current
Assets Held for Sale and
Discontinuing operations

IFRS 5 Non-Current Assets
Held for Sale and
Discontinuing operations

No standard

Ind AS 106 Exploration for
and Evaluation of Mineral
Resources

IFRS 6 Exploration for and
Evaluation of Mineral
Resources

No standard

Ind AS 107 Financial
Instruments : Disclosures

IFRS 7 Financial
Instruments : Disclosures

No standard

Ind AS 108 Operating
Segments

IFRS 8 Operating Segments

No standard

Not covered in Ind AS
It was earlier covered in
Exposure Draft

IFRIC 2 Members’ Share in
Co-operative Entities and
Similar Instruments

No standard

Not covered in Ind AS
Not Relevant in India

SIC 7 Introduction of Euro

No standard

Major Carve Outs
• Revenue Recognition (IND AS 18)
– IFRIC 15 – Agreement for construction of real estate has
not been adopted

CA Sandesh Mundra


Major Carve Outs
• Effects of changes in Foreign Exchange Rates
(IND AS 21)
– Option to recognise exchange differences on translation of
long term monetary items in equity

CA Sandesh Mundra


Major Carve Outs
• Related Party Disclosures (IND AS 24)
– Overriding nature of statue
– Definition of relative as per Co.s Act

CA Sandesh Mundra


Major Carve Outs
• Business Combinations (IND AS 103)
– Recognition of gain on day one accounting for a business
combination in capital reserve as opposed to income
statement under IFRS 3
– Guidance on Common Control Transactions

CA Sandesh Mundra


Major Carve Outs
• Employee Benefits (IND AS 19)
– Government bond rate as discount rate
– Recognition of acturial gains and losses – Other long term
employee benefits – only in OCI and not P&L or P&L
amort
– Frequency of Acturial Valuation

CA Sandesh Mundra


Major Carve Outs
• Financial Instruments – Rec and Msrmt (IND
AS 39)
– Change in fair value of a financial liability due to entitiy’s
own credit risk.

CA Sandesh Mundra


Major Carve Outs
• Investment in Associates (IND AS 28)
– Different accounting periods and policies of associates

CA Sandesh Mundra


Major Carve Outs
• Investment Property (IND AS 40)
– Only Cost Model

CA Sandesh Mundra


Major Carve Outs
• EPS (IND AS 33)
– Both Standalone and CFS

CA Sandesh Mundra


Major Carve Outs
• Govt Grants (IND AS 20)
– Non-monetary government grants only at fair value and not at nominal
value

CA Sandesh Mundra


Inventories

IND AS 2 VS AS 2

CA Sandesh Mundra


IND-AS 2 - Inventories

Fair value of purchases

CA Sandesh Mundra


Timing of recognition of purchases

CA Sandesh Mundra


Cost of inventories of a service
provider

CA Sandesh Mundra


Changes in Accounting Policies, Estimates, Prior Period Itesm

IND AS 8 VS AS 5

CA Sandesh Mundra


IND AS 8 - Acc pol., changes in acc est., errors

Changes in accounting policies

CA Sandesh Mundra



Changes in method of depreciation

CA Sandesh Mundra


Prior period items
- errors or omissions arising from a failure to use or
misuse of reliable information
- Retro

CA Sandesh Mundra



extraordinary items

CA Sandesh Mundra


Events after Balance Sheet Date

IND AS 10 VS AS 4

CA Sandesh Mundra


IND AS 10 - Events after reporting date

• Proposed dividend

CA Sandesh Mundra


Construction Contracts

IND AS 11 VS AS 7

CA Sandesh Mundra


IND AS 11 - Construction Contracts
Service Concession Arrangements (Ex)

CA Sandesh Mundra


Ex – Service Concession Agrmt.
• A incurs cost of INR 1,000,000 for construction
of a road.
• In consideration, A receives a right to charge
toll of INR 30 on each vehicle plying on that
road for 30 years

CA Sandesh Mundra


Construction Contracts
Agreements for construction of real estate

CA Sandesh Mundra


Revenue Recognition

IND AS 18 VS AS 9

CA Sandesh Mundra


IND AS 18 – Revenue Recognition
Multiple element arrangements (Ex)

CA Sandesh Mundra


Example
• A sells a machine with a two year
maintenance service for INR 1,000,000 to a
customer.
• A two year maintenance service is provided to
other customers at a consideration of INR
200,000.

CA Sandesh Mundra



Linked transactions
Examples –
Loan origination fees charged by banks

CA Sandesh Mundra



Customer loyalty programmes

CA Sandesh Mundra



Extended credit

CA Sandesh Mundra



Barter transactions
• Recognition of transactions that were
previously not recognised (for example,
certain advertising barter transactions);
• Non-recognition of transactions that are
currently being recognised (for example,
certain oil barter transactions).

CA Sandesh Mundra


• Percentage Completion

CA Sandesh Mundra


Business Combination and Consolidations

IND AS 27/28/31/103 VS
AS 14/21/23/27
CA Sandesh Mundra


Business Combination / Consolidation
Definition of Control
– Substance over form
– Temporary
– SPE

CA Sandesh Mundra


Contingent Consideration / Acq Date

CA Sandesh Mundra


• Goodwill
– Fair Value of assets & liabilities acquired
– Amortisation

CA Sandesh Mundra


• Minority
– Fair Value
– Negative

CA Sandesh Mundra


Uniform Accounting Policy & Time Gaap

CA Sandesh Mundra


Proportionate Consolidation

CA Sandesh Mundra


Step up and Step down

CA Sandesh Mundra


Property, Plant & Equipment

IND AS 16 VS AS 10

CA Sandesh Mundra


IND AS 16 –Property, Plant & Eqpmt
• Overhead allocation

• Component approach

CA Sandesh Mundra


Site Restoration

CA Sandesh Mundra


• Revaluation of assets
• Depreciation on the same

CA Sandesh Mundra


• Cash Price Equivalent

CA Sandesh Mundra


• Residual Value and Useful life

CA Sandesh Mundra


Borrowing Costs

IND AS 23 VS AS 16

CA Sandesh Mundra


IND AS 23 - Borrowing Costs (BC)
No period as 12 months

CA Sandesh Mundra


IND AS 23 - Borrowing Costs (BC)
Consolidation :– Special case of capitalisation of BC
– Group Average borrowing rate

CA Sandesh Mundra


Cash Flow Statement

IND AS 7 VS AS 3

CA Sandesh Mundra


IND AS 7 - Cash Flow
• Undistributed profits of associates and noncontrolling interests’ under operating
activities.

CA Sandesh Mundra


IND AS 7 - Cash Flow
• Ind AS 7 requires to report the aggregate
amount of the cash paid or received as
consideration for obtaining or losing control

CA Sandesh Mundra


Deferred Tax

IND AS 12 VS AS 22

CA Sandesh Mundra


IND AS 12
Balance sheet approach (Ex)

CA Sandesh Mundra


IND AS 12
Examples
– on revaluation of PPE;
– indexation beneﬁts for freehold land and
investments;
– fair value changes for available for sale securities;

CA Sandesh Mundra


IND AS 12
Deferred Taxes arising in consolidation

CA Sandesh Mundra


IND AS 12
Reconciliation of current tax as per actual
basis and as per applicable statutory rate

CA Sandesh Mundra


Leases

IND AS 17 VS AS 19

CA Sandesh Mundra


IND AS 17 - Lease
Embedded leases (Ex)

CA Sandesh Mundra


Ex of an Embedded Lease
• A enters in a purchase contract with B to
purchase 1,000 units of product every month at
INR 25 per unit.
• Product can only be manufactured on a speciﬁc
machine owned by B.
• In case of any shortfall in procurement, A will
compensate B at the rate of INR 25 per unit of
shortfall.
• The entire output from machine is availed by A.
CA Sandesh Mundra


IND AS 17 - Lease
Leases of land

CA Sandesh Mundra


IND AS 17 - Lease
• Lease incentives
– Initial rent free period ?

CA Sandesh Mundra


IND AS 17 - Lease
• Lease deposits

CA Sandesh Mundra


Employee Benefits

IND AS 19 VS AS 15

CA Sandesh Mundra


IND AS 19 - Employee Benefits
• Actuarial gains and losses in OCI
– defined benefit plans and other long term
employment benefit plans.

CA Sandesh Mundra


Foreign Exchange

IND AS 21 VS AS 11

CA Sandesh Mundra


IND AS 21 – Foreign Exchange
• Functional Currency vs Domicile Currency

CA Sandesh Mundra


• Permits FE diff on long term monetary items
to be posted to equity. The accumulated diff
can be transferred to P/L over the term of
such item

CA Sandesh Mundra


• Existing AS 11 permits capitalisation / deferral
of Fe Gain/Loss arising from long term
monetary items

CA Sandesh Mundra


Government Grants

IND AS 20 VS AS 12

CA Sandesh Mundra


IND AS 20 – Govt Grants
•
•
•
•

No credit to Reserves
No credit to PPE
Concessional Loans
Non-Monetary Grants

CA Sandesh Mundra


Related Party

IND AS 24 VS AS 18

CA Sandesh Mundra


IND AS 18 – Related Party
•
•
•
•

Defines close members of family
KMP of parents
Non-executive directors
Group companies

CA Sandesh Mundra


Earning Per Share

IND AS 33 VS AS 20

CA Sandesh Mundra


IND AS 33 – EPS
• Amounts debited to Share Premium
• Compulsory convertible instruments
• Shares held by Trust

CA Sandesh Mundra


Share Based Payments
• Fair Value Model
• Grants to employees of Parent
• Shares Held in Trust

CA Sandesh Mundra


•
•
•
•
•
•

Intangibles – Life – Finite or Indefinite
Investment Property – Classification
Financial Instruments
Segments
Provisions
Impairments

CA Sandesh Mundra


Contact Details
Aarna Soft Solutions Private Limited
Email: info@aarnasoft.net
Mobile: +91 94260 24975
Web: www.aarnasoft.net

Thank You !
CA Sandesh Mundra


AS vs IND AS (Old vs New Indian Accounting Standards)

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to AS vs IND AS (Old vs New Indian Accounting Standards)

Similar to AS vs IND AS (Old vs New Indian Accounting Standards) (20)

More from sandesh mundra

More from sandesh mundra (20)

Recently uploaded

Recently uploaded (20)

AS vs IND AS (Old vs New Indian Accounting Standards)