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CS Executive · Corporate Accounting and Financial Management · Introduction to Corporate Accounting

Under the Companies Act, 2013, who prescribes the standards of accounting that companies must follow, as recommended by the Institute of Chartered Accountants of India?

The Central Government prescribes accounting standards under Section 133 of the Companies Act, 2013. It acts on the recommendations of the ICAI, after consulting and examining the recommendations of the National Financial Reporting Authority. Neither the Registrar, a company's board nor SEBI holds this power under that section.

  1. AThe Central GovernmentCorrect
  2. BThe Registrar of Companies
  3. CThe Board of Directors of each company
  4. DThe Securities and Exchange Board of India

Explanation

Section 133 states that the Central Government may prescribe the standards of accounting or any addendum thereto, as recommended by the ICAI, in consultation with and after examination of the recommendations of the National Financial Reporting Authority. The Registrar, the board and SEBI do not prescribe these standards under that section.

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