News Items on Accounting Topics
The auditing standards that deal with the auditor’s responsibility to obtain written representations from management and, where appropriate, those charged with governance. Written representations are statements provided by management to confirm certain matters or to support other audit evidence. While written representations are an important source of audit evidence, they do not provide sufficient appropriate audit evidence on their own, and the auditor must obtain other audit evidence to support the conclusions on which the audit opinion is based.
Ind AS (Indian Accounting Standards) are a set of accounting standards that have been adopted from IFRS (International Financial Reporting Standards). Ind AS is designed to meet the needs of Indian companies by helping them to manage their financial reporting obligations in a fair and transparent manner.
Ind AS are the Indian version of International Financial Reporting Standards (IFRS). The standards were developed by the Ministry of Corporate Affairs (MCA) as a way to bring India’s financial reporting in line with global best practices. They are meant to provide more consistency, transparency, and accuracy when it comes to financial statements.
The Reserve Bank of India has released guidelines for the implementation of Indian Accounting Standards (Ind AS) by Non-Banking Financial Companies (NBFCs) and Asset Reconstruction Companies (ARCs). The responsibility of preparing and ensuring fair presentation of financial statements vests primarily with the Board of Directors of the NBFC/ARC. The guidelines provide clarity on regulatory capital in the light of Ind AS implementation, including asset classification and provisioning, and the need to ensure consistency in the application of the accounting standards in specific areas. NBFCs/ARCs are required to put in place board-approved policies, and articulate objectives for managing each portfolio. The…
The Reserve Bank of India vide its notification dated 12th Nov 2021 regarding Prudential norms on Income Recognition, Asset Classification and Provisioning (IRACP) pertaining to Advances have provided clarifications which is likely to have a significant impact on the provisioning for all financial institutions including Banks and NBFCs. The notification applies to all lending institutions and issued to clarify and harmonise certain aspects of the extant regulatory guidelines.