ICAI releases ED of Initial Application of Ind AS 117 and Ind AS 109



Quick Summary
The Institute of Chartered Accountants of India (ICAI) has released an Exposure Draft concerning the initial application of Indian Accounting Standards (Ind AS) 117 (Insurance Contracts) and Ind AS 109 (Financial Instruments). These proposed amendments align with recent changes made by the International Accounting Standards Board (IASB) to IFRS 17 and IFRS 9. A key proposal includes a 'classification overlay' to assist entities applying both standards simultaneously, particularly regarding comparative financial asset information.

Accounting Standards Board
The Institute of Chartered Accountants of India
8th February, 2022

Exposure Draft of Initial Application of Ind AS 117 and Ind AS 109- Comparative Information - Amendments to Ind AS 117, Insurance Contracts
 

ICAI Issues Exposure Draft on Ind AS 117 and Ind AS 109

Sub: Exposure Draft of Indian Accounting Standard for Comments

As you are kindly aware that the Indian Accounting Standards (Ind AS) are based on the IFRS Standards issued by the International Accounting Standards Board (IASB). In this regard, it may be noted that IFRS Standards are being issued/revised by the IASB from time to time. As a part of convergence with IFRS Standards, Ind AS may be issued/revised corresponding to the IFRS Standards. Accordingly, whenever any amendments are made or new IFRS Standard/IFRIC by the IASB, the Accounting Standards Board (ASB) of the ICAI considers and issues amendments to Ind AS. While doing so, keeping in view the Indian conditions and circumstances, wherever considered appropriate, necessary changes are also proposed to the Ind AS.

In this regard, the Accounting Standards Board has issued Exposure Draft of amendments in Ind AS 117 corresponding to IASB’s amendments in IFRS 117 on Initial Application of IFRS 17 and IFRS 9- Comparative Information - Amendments to IFRS 17, Insurance Contracts.

The draft amendments added a transition option (classification overlay-paragraphs C28A-C28E) relating to comparative information about financial assets presented where an entity first apply Ind AS 117 and Ind AS 109 at the same time. Amendments have also been proposed to make the classification overlay available to entities that have applied Ind AS 109 before they apply Ind AS 117. For these entities, the classification overlay has been prescribed for the application of paragraph C29 of Ind AS 117 and can be applied only to financial assets derecognised in the comparative period.

The downloadable version of the Exposure Draft is available at: here

Comments can be submitted using one of the following methods, so as to be received not later than March 10, 2022:
 

1. Electronically: Click on https://www.icai.org/comments/asb/ to submit comment online (Preferred method)
2. Email: Comments can be sent to: commentsasb@icai.in
3. Postal: Secretary, Accounting Standards Board,
The Institute of Chartered Accountants of India,
ICAI Bhawan, Post Box No. 7100,
Indraprastha Marg, New Delhi 110 002

Further clarifications on the Exposure Draft may be sought by e-mail to asb@icai.in.

FAQ :

The ICAI has released an Exposure Draft of amendments for the initial application of Ind AS 117 and Ind AS 109.

The purpose is to propose amendments to Ind AS 117 and Ind AS 109, aligning them with recent amendments made by the IASB to IFRS 17 and IFRS 9.

The 'classification overlay' is a transition option added to the draft amendments, specifically relating to comparative information about financial assets when an entity first applies Ind AS 117 and Ind AS 109 at the same time.

The classification overlay can be used by entities applying Ind AS 109 before they apply Ind AS 117, and it applies only to financial assets derecognised in the comparative period.

Comments can be submitted electronically via the ICAI website, by email to commentsasb@icai.in, or by post to the Secretary, Accounting Standards Board, ICAI.

Comments must be received no later than March 10, 2022.




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