Align Your Financial Reporting with Global Standards
In today’s interconnected economy, transparent and globally comparable financial reporting is essential. The convergence of Indian Accounting Standards (Ind AS) with International Financial Reporting Standards (IFRS) represents a significant step toward that goal. It ensures that Indian companies can present their financials in a format that meets both domestic and international expectations.
What Is IFRS / Ind AS Convergence?
IFRS (International Financial Reporting Standards) are globally recognized accounting standards developed by the International Accounting Standards Board (IASB). Ind AS (Indian Accounting Standards) are India’s version of IFRS, adapted with certain modifications to suit the Indian regulatory and economic environment.
➡ Convergence means aligning India’s accounting framework (Ind AS) with IFRS principles while making necessary carve-outs or adjustments to accommodate local laws and practices.
Why Is It Important?
⇒ Global Credibility: Improves investor confidence by enhancing comparability with international peers.
⇒ Regulatory Compliance: Mandatory for certain Indian companies as per MCA roadmap.
⇒ Access to Capital: Easier access to global capital markets and improved credit ratings.
⇒ Enhanced Transparency: Provides a true and fair view of the financial health of a business.
Applicability of Ind AS
Ind AS is applicable in a phased manner, primarily based on the net worth and listing status of a company:
- Companies listed or in the process of listing on stock exchanges in India or abroad
- Unlisted companies with a net worth above a specified threshold
- Subsidiaries, joint ventures, or associates of such companies
Key Challenges During Convergence:
Transitioning from Indian GAAP to Ind AS/IFRS involves more than just accounting adjustments. Common challenges include:
- Valuation of financial instruments and fair value measurements
- Lease accounting and revenue recognition changes
- Restatement of prior period figures
- Employee benefits and share-based payments
- Deferred taxes and MAT (Minimum Alternate Tax) implications
Our IFRS / Ind AS Convergence Services
We provide end-to-end support for a smooth transition from Indian GAAP to Ind AS or IFRS:
- Impact Assessment & Gap Analysis
- Lease accounting and revenue recognition changes
- Restatement of prior period figures
- Employee benefits and share-based payments
- Deferred taxes and MAT (Minimum Alternate Tax) implications