Accountancy - Accounting Standards in India | 11th Accountancy : Chapter 2 : Conceptual Framework of Accounting
Chapter: 11th Accountancy : Chapter 2 : Conceptual Framework of Accounting
Accounting Standards in India
Accounting Standards in India
In India, Standards of Accounting is issued by the Institute of Chartered Accountants of India (ICAI). The Council of the Institute of Chartered Accountants of India constituted Accounting Standards Board (ASB) on 21st April, 1977 recognising the need for Accounting Standards in India. ASB formulates Accounting Standards so that such standards may be established by the Council of the Institute in India. The ASB will consider the applicable law, custom, usage, business environment and the International Accounting Standards while framing Accounting Standards (AS) in India.
Due to globalisation, the accounts prepared in
India must be compatible with accounts prepared in other countries. This has
resulted in the existing AS being converged with the IFRS. This convergence has
resulted in what is known as Ind AS. Ind AS are basically the International
Accounting Standards which have been modified in accordance with Indian
accounting practices, customs and traditions. Presently, all big companies have
to follow Ind AS rules, but smaller business units are allowed to continue
using AS. In future, it is expected that all business entities in India will
migrate to Ind AS.
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