This document discusses India's convergence with International Financial Reporting Standards (IFRS). It provides definitions of IFRS and outlines reasons for its adoption, including the demand for global accounting standards. It describes India's specified approach, including the 35 applicable IFRS standards and implementation timeline. It also summarizes the roadmap set by the Institute of Chartered Accountants of India, including allowing two sets of standards, and specifies companies required to adopt IFRS. The document outlines benefits of global compatibility and major changes between IFRS and existing standards, as well as challenges to implementation.

1. 1

2. Introduction
• What is IFRS?
– International financial reporting standards are
a set of accounting standards developed by
the international accounting standard board
that is becoming the global standard for the
presentation of public company financial
statements
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3. Introduction
• Why IFRS?
– Demand for one set of common global
reporting Standards
– International Companies desire to use one set
of financial standards throughout the world
– Growth in capital markets ( IFRS enhances
the ability of filers to raise capital outside their
borders)
– Reducing Capital Cost and Reporting Costs
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4. How India is Converging?
• Specified approach
• Thirty Five IND AS
• Date of Implementation
• Comparatives
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5. Road Map by ICAI
• Two separate sets of accounting
standards
• The first set would comprise of IFRS
converged accounting standards (IND AS)
• The second set would comprise of existing
Indian Accounting Standards
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6. Specified Approach
• Specified class of companies
• Listed Companies
• Un listed companies having networth of 500
Cr INR or more
• Holding & Subsidiaries of companies covered
above
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7. Comparatives
For this purpose an entity should in its op IND AS B/s
A)All assets and liabilities whose recognition is required by IND AS
B)Not recognize items as assets or liabilities if IND AS do not permit
such recognition
C) Reclassify the items that it recognized in accordance with IND AS
D) Apply IND AS in measuring all recognizing assets and liabilites
• It may also be noted that the op. balance Sheet is to be prepared on
the date of transition ie., the beginning of the earliest comparative
period presented eg: If an entity adopted IND AS from 2016-17 its
date of transition will be 1st April 2015 and thus it required to prepare
its opening IND AS balance sheet on 1st April, 2015
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8. Other Clarifications …….
• Voluntary Adoption
– Option for Other than specified companies
• Net worth
– Share Capital + Reserve less revaluation
reserve
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9. Impact of IFRS
• IFRS is heavy on Transparency and
impact accounting
• All the events that have impact on
company’s finances have to be accounted
• It also stringent income recognition rules
• Global Benchmarking
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10. Benefits of Global Compatibility
– The Economy
– Corporate world
– Investors
– Accounting Professionals
– Bank/Financial Institutions
– Regulators
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11. Major Changes of AS/IFRS
• Principal Based Vs Rule Based Standards
• Standards Vs Local Laws
• Presentation of Financial Statements
• Depreciation on Fixed assets
• Cash Flow Statements
• Valuations
• Changing in Accounting policy
• Adoption Methodology
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12. Key Challenges….!!
• Economic Environment
• SME’s problems
• Training to preparers
• Interpretation
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13. IND AS & Carve Outs
What is Carve Out??
Difference between IND
AS and equivalent requirement under
IFRS
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14. Categorization….
• Mandatory Deviations from IFRS
• Optional Deviations from IFRS
• Removal of Choices
• Others
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15. Mandatory Deviations…..
• Recognition
– Revenues from sales of real estate on a
percentage basis
– embedded foreign currency conversion option
as equity
– Bargain purchase gains as capital reserves
– Mandatory use of Govt. securities yields
– Fair value of financial liabilities
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16. Optional deviations….
• Choice to
– Defer exchange differences
– Deemed Cost for fixed assets
– De recognition provisions prospectively
– Exemption for financial instruments
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17. Removal of Choices…
• Single Statement presentation
• Classification of
– Expenses
– Interest and Dividend
• Carry investment property at fair value
• Govt. grants should be classified as
deferred income
• Recognition of actuarial gains in reserves
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18. Others ….
• No Separate guidance on accounting for
biological assets
• Deferral of accounting for embedded
leases
• Deferral of accounting for service
concession arrangements
• Goodwill may be recognized
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19. Statutory’s Initiatives
• Providing education and training
– Certification courses offered
– IFRS e-learning course has been launched
– Large scale IFRS awareness drive with MCA
collaboration
– Conceptual differences with IASB
– Organizing of Workshops
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20. Conclusion
• Irrespective of challenges adoption of
IFRS in INDIA will significantly change the
contents of corporate financial statements
as a result of :
More refined measurements
Enhanced disclosures
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21. Truthful remarks….
A small truth to make our Life 100%
successful ..........
If
A B C D E F G H I J K L M N O P Q R S T U V
W X Y Z
Is equal to
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21
22 23 24 25 26
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22. Continued……
Then
• H+A+R+D+W+O+R+K =8+1+18+4+23+15+18+11 = 98%
K+N+O+W+L+E+D+G+E = 11+14+15+23+12+5+4+7+5 =96%
L+O+V+E = 12+15+22+5= 54%
L+U+C+K = 12+21+3+11 = 47%
• (None of them makes 100%) ..............................Then what makes 100%
Is it Money? ..... No!!!!!
Leadership? ...... NO!!!!
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23. Continued…..
Every problem has a solution, only if we
perhaps change our "ATTITUDE". It is OUR
ATTITUDE towards Life and Work that
makes OUR Life 100% Successful..
A+T+T+I+T+U+D+E =
1+20+20+9+20+21+4+5 =
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