Accounting Standards in India

4.1 Structure of Indian Accounting Standards

India has a dual standard regime:

Standard Set	Applicable To	Convergence
Accounting Standards (AS 1 to AS 32)	Non-listed companies, smaller entities	Indian GAAP (traditional)
Ind AS (Ind AS 1 to Ind AS 116)	Listed companies, unlisted companies with net worth ≥ ₹250 crore	Converged with IFRS (not identical)
IFRS	Multinational companies, Indian companies raising capital abroad	International standard (IASB)

4.2 Phase-wise Ind AS Implementation

MCA Roadmap:

• Phase 1 (FY2016-17): Companies with net worth ≥ ₹500 crore; listed companies
• Phase 2 (FY2017-18): Companies with net worth ₹250–₹500 crore; listed companies in SME segment
• Banks, NBFCs, Insurance: Separate MCA/RBI/IRDAI roadmaps; banks adopting Ind AS phased from FY2020 (deferred multiple times; currently under review by RBI)

4.3 Key Indian Accounting Standards — Exam Relevant

Standard	Title	Key Provision	Exam Relevance
AS 1 / Ind AS 1	Disclosure of Accounting Policies	Entities must disclose accounting policies adopted	GAAP foundation
AS 2 / Ind AS 2	Valuation of Inventories	Lower of Cost or Net Realisable Value (LCNRV)	Prudence application
AS 6 / Ind AS 16	Depreciation / Property, Plant & Equipment	Methods: SLM, WDV; useful life; Schedule II guidance	Depreciation
AS 9 / Ind AS 18/115	Revenue Recognition	Revenue when risks and rewards transferred (earned)	Accrual concept
AS 10 / Ind AS 16	Property, Plant & Equipment	Historical cost; component accounting	Fixed assets
AS 13 / Ind AS 109	Accounting for Investments	Current: lower of cost or market; Non-current: cost or fair value	Investment accounting
AS 22 / Ind AS 12	Income Taxes / Deferred Tax	Deferred Tax Asset (DTA) and Deferred Tax Liability (DTL)	Tax accounting
AS 28 / Ind AS 36	Impairment of Assets	Reduce asset value when recoverable amount < carrying value	Asset valuation
Ind AS 116	Leases	Operating leases now on balance sheet (IFRS 16 equivalent)	Lease accounting

4.4 NFRA — Independent Oversight

NFRA (National Financial Reporting Authority) was established under Section 132 of Companies Act 2013, operationalised in October 2018. Roles:

• Recommend accounting and auditing policies and standards
• Monitor and enforce compliance by listed companies and large unlisted ones
• Investigate and take disciplinary action against CA firms for professional misconduct
• First major NFRA action (2021): NFRA imposed ₹1 crore penalty on IL&FS audit firm (Deloitte Haskins & Sells) and banned two partners for 5 years — signalling strong regulatory intent

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