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CMA Intermediate · Financial Accounting · Introduction to Accounting Standards (GAAP, AS and Convergence to Ind AS)

According to the Preface to the Statements of Accounting Standards, while formulating Accounting Standards the Accounting Standards Board (ASB) of ICAI is expected to treat the IFRSs issued by the IASB in which manner?

The ASB gives due consideration to IFRSs issued by the IASB and tries to integrate them to the extent possible, keeping in view Indian conditions and practices. It does not copy them mechanically, nor does it ignore them, because ICAI promotes global harmonisation.

  1. AGive them due consideration and try to integrate them to the extent possible, in light of the conditions and practices prevailing in IndiaCorrect
  2. BAdopt them word for word without any modification
  3. CIgnore them, since Indian standards are framed only on domestic practice
  4. DApply them only to Level IV entities that are non-company entities

Explanation

Paragraph 2.3 of the Preface says the ASB will give due consideration to IFRSs issued by the IASB and try to integrate them to the extent possible, in the light of conditions and practices prevailing in India. Word-for-word adoption is not required, so the second option is wrong.

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