A PRESENTATION ON ACCOUNTING STANDARDS

GROUP MEMBERS
Kunal Lunia - 12227 Ankita Shrivastava - 12205 Vijay Gupta - 12350 Anushree Jaiswal - 12240 Pooja Singh - 12237 Jose Tom - 12225 Jitesh Talesara - 12222

FLOW OF PRESENTATION

INTRODUCTION
Written Documents issued by Government or Regulatory Body In India, Issued by ICAI on 21st April, 1977 Initiated by Kumar Mangalam Birla, Chairman, Committee of Corporate Governance for Financial Disclosures Also initiated by Chair person of NACAS

OBJECTIVES
Standardize the diverse Accounting Policies Add the Reliability to the Financial Statements Eradicate baffling variation in treatment of accounting concepts Facilitate inter-firm and intra-firm comparision

ACCOUNTING STANDARDS IN DIFFERENT NATIONS

In India, 32 Accounting Standards as IAS under NACAS As per International, there are 41 Accounting Standards called as IFRS Adopted by 8 Countries in the World 70 to 80 Countries planning to adhere IFRS

ACCOUNTING STANDARDS

AS 17 Segment Reporting
Business Segment: It is a distinguishable component of an enterprise that is engaged in providing an individual product/ service or a group of related products /services and that is subject to risks and returns that are different from those of other business segments. Geographical Segment: It is a distinguishable component of an enterprise that is engaged in providing products/services within a particular economic environment and that is subject to risks and returns that are different from those of components operating in other economic environments.

APPLICABILITY
Banks including co-operative banks Financial Institutions Enterprises carrying on Insurance business Holding and Subsidiary Enterprises Enterprise whose equity or debt securities are listed on a recognized stock exchange in India All commercial, industrial & business reporting enterprise whose annual turnover exceed Rs.50 Crores.

Contd
Scope: This Statement should be applied in presenting general purpose financial statements The requirements of this statements are also applicable in case of consolidated statements An enterprise should comply with the requirements of this statement fully and not selectively Objective : Segment information is relevant in assessing the risks & returns of a diversified or multilocational enterprise.

AS 18 Related Party Disclosures

Scope: This AS should be applied in reporting related party relationships and transactions between a reporting enterprise & its related parties. The related party relationships covered by this AS are: a) Enterprises that are controlled by, or control, or are under common control with, the reporting enterprise, either directly or indirectly.

Contd
Associated & joint ventures of reporting enterprise, and vice-versa Individuals controlling significant voting power of the reporting enterprise, and relatives of any such individual Key management personnel & relatives of such personnel

Disclosure Requirements
Name of transacting related party Description of relationship Description of nature and volume of transactions Amounts outstanding and provisions for doubtful debts in respect of related parties at the Balance Sheet date Amounts written off/back in the period in respect of debts due from/to related parties

AS 19 - Leases
Lease: It is an agreement whereby Lessor conveys to the Lessee in return for a payment or series of payments the right to use an asset for an agreed period of time Financial Lease: It is a lease that transfers substantially all the risk and rewards incident to ownership of an asset Operating Lease: It is a lease other than a financial lease

Contd
Gross Investment in the lease: Aggregate of MLPs under a financial lease and any unguaranteed residual value arising to the lessor Net Investment in the Lease: Gross Investment Unearned finance income

Scope
Lease agreements to explore for or use natural resources, and other mineral rights Lease agreements to use lands Licensing agreements

Disclosure Requirements
Assets acquired under finance lease, as segregated from the assets owned For each class of assets, the net carrying amount at the balance sheet date A reconciliation between the total of MLPs at the balance sheet date and their PV

AS 20 Earnings Per Share

Applicability
a) Companies whose equity shares or potential equity shares are listed on a recognized stock exchange in India b) All Companies whether listed or not, which are calculating and disclosing their earning per share

Some Important Definitions

A financial statement is any contract that gives rise to both a financial asset of one enterprise and a financial liability or equity shares of another enterprise A potential equity share is a financial instruments or other contract that entitles, or may entitle, its holder to equity shares. Some example are convertible debentures, convertible preference shares etc.

Scope
In consolidated financial statements, the information required by this AS should be presented on the basis of consolidated information. EPS = Profit after tax No. of Equity Shares

AS 21 Consolidated Financial Statements

Applicability a) It comes into effect in respect of accounting periods commencing on or after 01.04.2001 b) It shall be applicable to the enterprises that prepare and present C.F.S.

Objective and Scope

Objective: It lays down principles and procedures for preparation and presentation of C.F.S. Scope: This AS is also applicable for accounting for investments in subsidiaries in the separate financial statements of a parent company

Disclosure Requirements
If a subsidiary is left out from C.F.S., the reasons for the same should be disclosed