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

Which of the following best describes the effect of applying Indian Accounting Standards (Ind AS) in India?

Ind AS apply to companies that meet prescribed criteria such as listing status and net worth thresholds, and they are converged with IFRS with certain carve-outs. They are not for all companies, are not limited to banks, and are legally notified under the Companies Act rather than being voluntary.

  1. AInd AS are applicable to companies based on prescribed net worth and listing criteria, and are converged with IFRS with some carve-outsCorrect
  2. BInd AS are applicable to every company irrespective of size or listing status
  3. CInd AS are applicable only to banks and insurance companies
  4. DInd AS are voluntary guidelines issued by ICAI with no legal backing

Explanation

Ind AS apply in phases to specified companies depending on listing status and net worth thresholds, and they are converged with IFRS with certain carve-outs. They are not applicable to all companies, since smaller companies follow the Accounting Standards under the 2006 Rules. They are notified under the Companies Act, so they have legal backing.

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