On Friday, the company affairs ministry notified the Companies (Indian Accounting Requirements) Guidelines, 2021. The adjustments have been made after consultations with the National Financial Reporting Authority (NFRA).
Sandip Khetan, Partner and Nationwide Chief, Monetary Accounting Advisory Companies (FAAS) at EY India, mentioned the ministry has issued the second part amendments to rate of interest benchmark reform and “has consequently made amendments to Ind AS 109, Ind AS 107, Ind AS 104 and Ind AS 116”.
“The place the Part 2 amendments introduce new areas of judgement, entities want to make sure they’ve acceptable accounting insurance policies and governance in place. For the extra disclosures, entities should guarantee they will collect and current compliant info,” he famous.
Underneath the revised guidelines, entities are required to make extra disclosures associated to rate of interest benchmark reform. These dislcosures are to allow customers of economic statements to grasp the impact of rate of interest benchmark reform on an entity’s monetary devices and threat administration technique.
Entities must disclose the character and extent of dangers to which they’re uncovered arising from monetary devices topic to rate of interest benchmark reform, and the way the entities the handle these dangers.
Amongst others, there are adjustments within the foundation for figuring out the contractual money flows because of rate of interest benchmark reform.
Prateek Agarwal, Companion at Nangia & Co LLP, mentioned the disclosures will allow customers of economic statements to grasp the impact of those adjustments, together with an entity’s progress in finishing the transition to different benchmark charges.