Transformation of IND GAAP to IND as (Based on IFRS) its Impact on Financial Statement

On Feb 15, 2015, the ministry of corporate affairs, in consultation with the national advisory committee on accounting standard, notified the companies (Indian Accounting Standards) rule, 2015, laying down the roadmap for the implementation of Indian Accounting standards.

Apart from better disclosure, revised accounting standards will bring financial statement closer to economic reality. It will also ensure comparability between financial statements in line with global standards, and improve the ability of INDIAN companies to access funds abroad. Due to adoption of IND AS, the profitability number would be more volatile because of chances in fair valuation of derivatives and financial instrument (includingequity, debt and foreign currency loan obligation), amortization of goodwill, and reclassification of actual gain / losses. Companies in sectors such as capital goods, infrastructure, retail, IT service and auto ancillary are more likely to be impacted than others on account of revised accounting standards.