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CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

Discussion on IFRS

Dear All,

In the Current Scenerio Adoption of IFRS is really a major problem with most of the Companies. Every body is facing problems. Why not we discuss abt the IFRS so those people who are not aware abt the IFRS they also come to know that what is IFRS and who knows they can enhance there knowledge.

Best Regards

Amit Daga



 51 Replies

CA. Amit Daga

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

I am sharing small write up abt the IFRS. Hope it will be introduce you with IFRS

Why IFRS?
 
Ø      Numero-uno accounting framework with global acceptance.
Ø      Business going global, more cross border transaction
Ø      Access to international capital
Ø      Single global financial reporting language
Ø      Enhance confidence of global stakeholders
Ø      Facilitate International acquisition
Ø      Standardized quality of management information system   across global businesses
Ø      Peer to Peer Comparison
 
IFRS – Convergence
 
n      The convergence of global accounting standards to IFRS gained momentum, when in August 2007; the SEC permitted foreign companies that access capital market in US Capital markets and are listed on US Stock exchanges to file financial statement using IFRS without reconciliation to US GAAP.
n      On Nov 15, 2007 the Securities and Exchange Commission (SEC) unanimously approved the amendment to its rules and forms which allows using IFRS as issued by the IASB, to reconcile their financial statements with USGAAP. This represents that the world is moving towards convergence to one unified standard
 
IFRS in India
 
As of now more than 100 countries require or permit use of IFRS. China, Japan, South Korea and Canada have announced to converge between 2008 to 2011 respectively.
            ICAI has also setout a roadmap to converge with IFRS by 2011.
            1) For Public interest entities (i.e. listed entities, banks and insurance entities and certain other large sized entities)
            2) For other than public interest entities ( termed as small and medium sized entities (SME), a separate standard for SMEs may be formulated based on the IFRS for small and medium sized enterprises when finally issued by the IASB, after modification, if necessary
 
Financial statement – IFRS
 
A complete set of financial statements includes a:
&                           Balance sheet
&                           Income statement
&                           Statement showing changes in equity
&                           Cash Flow Statement
&                           List of Accounting policies
&                           Notes to financial statements
 
Balance sheet
 
n      The following items, as a minimum are presented on the face of the balance sheet:
n      Assets - PPE, Investment Property, Intangible assets, financial assets, and investment accounted for using the equity method, biological assets, deferred tax assets, Current tax assets, inventories, trade and other receivables and cash and cash equivalents.
n      Equity – issued capital and reserves attributable to equity holders of the parent, and minority interest.
n      Liabilities – deferred tax liabilities, current tax liabilities, financial liabilities, provisions, and trade and other payables.
n      Assets and liabilities held for sale – If held for disposal.
            Current and non current assets and liabilities to be presented as separate classification on the face of the balance sheet based on liquidity.
 
Income statement
 
n      No prescribed format, IFRS permits the income statement to be presented in either of the two methods:
n      Nature of Expenses
n      Functional cost          
F                 Material items by their nature and amounts are to be disclosed separately. Items such as restructuring cost, write down of inventories or PPE, Litigation settlement and gains or losses from disposals of non current assets etc.
 
F                 All items of income and expenses are deemed to arise from an entity’s ordinary activities. There is no category of extraordinary items in IFRS.
 
Statement of Changes in shareholders’ equity (SOCE)
 
n      The statement shows :
n      Capital transaction with the owners
n      Movement in accumulated profit and a reconciliation of all other components of equity
n      The total of income and expenses for the period, showing separately the amounts attributable to equity holders of the parent and to minority interest and the effect of changes in the accounting policies, prior period items, fair value gain /losses on land and building, Mark to market gain/(losses) on investment and certain financial instruments etc. (SORIE)
n      An enterprise cannot present both SORIE and SOCE as primary statement
 
Cash Flow Statement
 
n      The cash flow statement may be prepared either using:
n      Direct method (aggregate cash receipt / payment associated with operating activities) or
n      Indirect method (cash flows derived from adjusting net income for transactions of a non cash nature such as depreciation)
 
Q     IFRS is similar to Indian GAAP except that all listed companies in India as per SEBI is permitted only Indirect method.
Q     Cash and cash equivalent in IFRS also includes bank borrowings that are repayable on demand.
Q     No separate disclosure for extraordinary items
CA. Amit Daga

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

 

The following IFRS statements are currently issued:
CA. Amit Daga

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

I Would like to clearify one thingh that there is no difference between IAS and IFRS. All earlier standards are issued with the name of IAS and all new standards are issuing with the name of IFRS.
CA. Amit Daga

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

I would like to request to all of you. Please keep alive this forum, Send your query and share your knowledge.

Thank you very much

Best Regards

CA. Amit Daga

RITESH KHANDELWAL

RITESH KHANDELWAL (Corporate Taxation)     23 March 2009

Hello Amit!

Well its been delighting to have such handfull knowledge about IFRS ....well i might be interviewed on this topic in the campus Selection...........so i'ld be highly obliged if u kindly send me all the details or file in which more knowledge f IFRS can be gained.........my email id being charteredritesh @ gmail.com.........

Regards,

Ritesh

 

CA SRIRAM S

CA SRIRAM S (CHARTERED ACCOUNTANT)     23 March 2009

thanks thats very useful;

CA. Amit Daga

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

Ritesh.. its next to impossible to read Abt ifrs in the very short time (because if i am not wrong you have a campus in next week ) as well as interviewer is also aware that students are not aware abt the IFRS. So, i suggest dont go to deep knowledge abt the IFRS rite now.. Concentrate upon our own AS only but for knowledge purpose just read the basic of IFRS ie.

What is IFRS and bried idea abt it and trust on me that will be enough because if any body will ask max to max he will ask u waht do u know abt the IFRS thats it.

 

Best Regards

Amit Daga

RITESH KHANDELWAL

RITESH KHANDELWAL (Corporate Taxation)     23 March 2009

Dear Amit,

Actually my campus gets de on nxt session and nt the upcuming oe due to my artklshp period which gts over in Oct..........ne wayz i think by then it is gonn ab quite reasonable for a prsn to know in details abt IFRS.....if am nt wrong.........

CA. Amit Daga

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

Than its fine.. i will try to help you.. but its better if you buy some good books on IFRS and ask me your doubt because over the net its very much difficult to teach any one and now a days i will send article and forum message on regular basis for ifrs .

Best Regards

Amit

RITESH KHANDELWAL

RITESH KHANDELWAL (Corporate Taxation)     23 March 2009

Dear Amit

Well i would be pleased if u kindly tell me ur gmail / id, if any........and wann aknw if u r in Orkut......i really want to chat to u over some more relavant mattters.........jst waitn for ur reply brother.......

CA. Amit Daga

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

Hey Ritesh my gmail id is amit.daga83 @ gmail.com but i am not regular net surfer and i am available on orkut u can search me.. as well as if you go to my my id in ca club there you can get a link for orkut also

Sumit Jain

Sumit Jain (CA)     23 March 2009

may be this will help


Attached File : 40 34 presentations%20on%20ifrs[2].ppt downloaded: 125 times
CA. Amit Daga

CA. Amit Daga (Finance Controller CA. CS. CFA. CIFRS. M.COM. )     23 March 2009

Hey Pria i am posting the answer of your query over here may be it will be help ful for every one.

Her question :-  Wats SORIE and SOCE.

SOCE is statement of changes in equity

SORIE is statement of recognised income or expense

An entity has a choice of presenting either a statement of recognised income and expense
(“SoRIE”), or a SoCE as its primary statement, unless it adopts the policy of recognising directly in
equity all actuarial gains and losses on defined benefit post-employment plan in the period when
they occur, in which case, the entity will be required to present SoRIE as its primary statement.

 

CA Ankur Dhamanaskar

CA Ankur Dhamanaskar (Student)     23 March 2009

Thanks buddy it is really useful...........


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