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Accounting Standards for Sole Trader, LLP, HUF, OPC, Private Limited Company and Public Limited Comp

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Venkata Chennaiah

9 Points Posted on 20 July 2023

Sir,

Kindly explain which Accounting Standards should follow for preparation of Accounts in the below said business types.

Sole Trader

LLP

HUF

One Person Company

Private Limited Company

Public Limited Company

Replies (3)

Quick Summary

This discussion clarifies which accounting standards are applicable to various business structures in India. For non-corporate entities like Sole Traders, LLPs, and HUFs, the Accounting Standards issued by ICAI are generally followed, with specific categorisations (Level I-IV) based on turnover determining the extent of applicability. Corporate entities, including Private and Public Limited Companies, must adhere to Indian Accounting Standards issued by the MCA.

prasad Nilugal

GST Practitioner & Accounts

15146 Points Posted on 20 July 2023

1) Accounting Standard ( ICAI ) Non Corporate entities

2) Indian Accounting Standard ( MCA ) Corporate entities

For Non Corporate entities Accounting Standard issued by ICAI are applicable. Non Corporate entities are divided in to 4 Catagories 1) Level I , 2)Level Ii 3) Level III 4) Level IV based on Turnover, So any non corporate entity in Level I catagory all accounting standards are applicable, however certain relaxation is given to Level Ii, III , IV Catagory.

For Corporate entities like , PVt LTD companies, Public Ltd Companies, Banking Companies, Insurance Companies. NBFC etc Indian Accounting Standard issued by MCA are applicable.