22-Jan-2018: IndAS

Banks and non-banking financial companies are due to switch to Indian Accounting Standards (IndAS) from 1 April 2018. However, the government and the Reserve Bank of India (RBI) may postpone the implementation of new accounting standards for banks because of the legislative changes and additional capital requirements the process would entail.

Banks and non-banking financial companies currently follow Indian generally accepted accounting principles (GAAP) standards. Other corporate entities started complying with IndAS with effect from 1 April 2016.

Ind AS or Indian Accounting Standards govern the accounting and recording of financial transactions as well as the presentation of statements such as profit and loss account and balance sheet of a company. For long, there has been a heated debate about Indian companies moving to the globally accepted International Financial Reporting Standards (IFRS) for their accounts. But firms have resisted this shift, stating that this will lead too many changes in the capture and reporting of their numbers. IndAS has been evolved as a compromise formula that tries to harmonise Indian accounting rules with the IFRS.