Topic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
6) Discuss the salient features of Indian Accounting Standards why is it significant? Elaborate on the need to have an independent Accounting Standards. (250 words)
Why this question:
The question is in the context of recent move taken by RBI. The Reserve Bank of India (RBI) has deferred the implementation of new accounting rules, Indian Accounting Standards (Ind AS) for banks till further notice. This is the second extension provided by it. Earlier in April 2018, RBI had postponed the implementation of Ind AS by the banks by one year.
Key demand of the question:
The answer must explain with the salient features of Indian Accounting Standards (Ind AS) and elaborate on its significance and explain why it is necessary for us to have such a system in place.
Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments.
Structure of the answer:
Briefly narrate the context/backdrop or simple define what are Indian Accounting standards.
Explain the following –
- What is it?- compromise formula that tries to harmonize Indian accounting rules with the International financial reporting standards.
- Briefly discuss its salient features; structure ,current status, Legislative change required to implement IndAS etc.
- Practical challenges to it from – revenue recognition, financial instruments and fixed asset accounting etc.
Conclude with its importance.