Current standards for financial instruments as per AS?

What are the current accounting standards for financial instruments as per AS?

Currently there are no accounting standards that specifically address financial instruments except for certain forward foreign exchange contracts covered by AS 11. The Accounting Standards relating to financial instruments, viz, AS 30, AS 31 and AS 32 which form the Indian GAAP, did not see the light of the day as these were withdrawn by March 2011, just before the scheduled date on which these were supposed to become mandatory. This created a vacuum for accounting standards relating to financial instruments. The Indian Accounting Standard, viz, AS 109, which is the converged version of IFRS 9 is however becoming mandatory with effect from 1 April, 2016 for certain types of entities as notified by the MCA. This Guidance Note is meant for those entities not covered by the aforesaid notification and would be applicable from 1 April, 2016. This Guidance Note is an interim measure to provide recommendatory guidance on accounting for derivative contracts and hedge accounting, as there is no mandatory guidance in this regard currently.

Need for the guidance note on accounting for derivatives

Need for the guidance note on accounting for derivatives What is the need for the guidance note on accounting for derivatives? Currently, none of the notified accounting standards prescribe the proper accounting treatment for derivative contracts. Foreign exchange forward contracts, which are speculative in nature, ie, which do not hedge the …
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Entities that are required to follow the guidance note

Entities that are required to follow the guidance note What are the entities that are required to follow the guidance note? Banking, non-banking finance companies (NBFCs), housing finance companies and insurance entities follow derivative accounting promulgated by the respective regulatory authorities, viz, Reserve Bank of India (RBI), National Housing Bank (NHB), Insurance …
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Transactions within the scope of this guidance note

Transactions within the scope of this guidance note What type of transactions are within the scope of this guidance note and which are outside the scope? All transactions covered by AS 11, accounting for embedded derivative contracts and accounting for non-derivative financial assets/liabilities designated as hedging instruments are outside the scope of …
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Key accounting principles in the guidance note?

Key accounting principles in the guidance note? What are the key accounting principles mentioned in this guidance note? All derivatives should be accounted for at the inception and measured at fair value too at the inception as well as at every reporting period.If hedge accounting is not applied, then the derivatives should …
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Fair value hedge on discontinuation of hedge accounting

Fair value hedge on discontinuation of hedge accounting What happens to a fair value hedge on discontinuation of hedge accounting? Fair value hedge accounting as per the approach mentioned in the guidance note is significantly different from the fair value hedge accounting as per Ind AS 109. The fundamental difference arises on …
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