Practical Guide to Consolidation of Accounts

"The more you learn, you learn that you still have lot to learn”

Did you know?

• Before Companies Act 2013, only listed company was required to do Consolidation. AS 21 says that if a company is required to do consolidation then consolidation is required to be done as per criteria set up in AS 21.
• Earlier only listed companies was required to do consolidation as listing agreement required the same but with companies act 2013, sec 129 has defines financial statement to include CFS.

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Standards on Auditing – not a choice but a compulsion

What are Auditing Standards?

The Standards on Auditing is an area which requires greater focus of CA in practice as well as our administrative bodies who are updating our members. The Companies Act 2013 has discussed it in detail which was absent in erstwhile act.

As per Sec 2 (7) “auditing standards” means the standards of auditing or any addendum thereto for companies or class of companies referred to in sub-section (10) of section 143.

Sec 143 (9) reads “Every auditor shall comply with the auditing standards.”

As per Sec 143 (10) The Central Government may prescribe the standards of auditing or any addendum thereto, as recommended by the Institute of Chartered Accountants of India, constituted under section 3 of the Chartered Accountants Act, 1949, in consultation with and

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Exemptions in Ind AS 101 - First time adaption of Ind AS - Decoded

IFRS converged Ind AS has hit the door as many companies are preparing their comparatives under Ind AS for June 2016, which is June 2015 as well as March 2015 for Opening figures.

Optional Exemptions

Currently, Ind AS 101, has 20 optional exemption from retrospective application and the same has been categorized based on its importance and impact on financial statement  which are as follows

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Ind AS - the hinderances to come

A financial reporting system supported by strong governance, high quality standards and a sound regulatory framework is the key to economic development. Indeed, high quality standards of financial reporting, auditing and ethics form the foundations of the trust that investors place on financial information and therefore play an integral role in contributing to a country’s economic growth and financial stability. As the forces of globalisation prompt more and more countries to open their doors to foreign investment and as businesses expand across borders, both the public and private sectors are increasingly recognising the benefits of having a commonly understood financial reporting framework, supported by strong globally accepted standards. The benefits of a global financial reporting framework are numerous and include:

• Greater comparability of financial information for investors;
• Greater willingness on the part of investors to invest across borders;
• Lower cost of capital;
• More efficient allocation of resources; and
• Higher economic growth.

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The Era of E-Commerce

Friends we are seeing some real competition in E-Commerce,  till months back it was Flipkart vs #Snapdeal ( which started as a coupon seller) and then entered the big Amazon India,  but now the mobile recharger Paytm is taking all by storm with its great cash back policy.

The second battle is for cheapest car experience giver,  from the yellow taxies on kolkata Street we have two players fighting,  the first is multinational #Uber and on the other side is #ola cabs which recently acquired TaxiForSure and has also launched its services in kolkata.  In other cities ola also provides Auto Rickshaw services. Now both Uber and Ola are giving ride @ Rs 9 /Km with other charges and on the other hand the Ambassador charges Rs 12 /km.

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IndAS notified - Accounting Revolution in India

Moving closer to the implementation of new accounting norms, the government has notified the rules for Indian Accounting Standards (Ind AS), which will be mandatory for certain companies from the accounting periods beginning on or after April 1, 2016.

Ind ASs, which are converged with global standards IFRS, can be followed by corporates on a voluntary basis for accounting periods beginning on or after 1st April, 2015, with the comparatives for the periods ending on 31st March, 2015. Mandatory applicability of these standards is discussed below.

Please note that banking, insurance and non-banking finance companies are currently exempted from the roadmap.

Companies with obligation to comply with Indian Accounting Standards (Ind ASs) for the accounting periods beginning on or after 1st April, 2016

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