ICAI releases Guidance Note on Applicability of AS 25 and Measurement of Income Tax Expense for Interim Financial Reporting

Last updated: 28 April 2021

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The Institute of Chartered Accountants of India (ICAI) has issued a new Guidance Note concerning the application of Accounting Standard (AS) 25 for interim financial reporting. This note clarifies whether AS 25 applies to interim results required by statutes or regulators, such as quarterly reports for listed companies under SEBI regulations. It also addresses how to measure income tax expense within these interim financial reports. Consequently, two previous guidance notes on related topics have been withdrawn.

Guidance Note on Applicability of AS 25 and Measurement of Income Tax Expense for Interim Financial Reporting

(The following is the text of the ‘Guidance Note on Applicability of AS 25 and Measurement of Income Tax Expense for Interim Financial Reporting’, issued by the Institute of Chartered Accountants of India. Pursuant to the issuance of this, “Guidance Note on Applicability of AS 25 to Interim Financial Results” and “Guidance Note on Measurement of Income Tax Expense for Interim Financial Reporting in the Context of AS 25”, stand withdrawn.)

Introduction

1. This Guidance Note deals with the following issues:

- whether Accounting Standard (AS) 25, Interim Financial Reporting, is applicable to interim financial results presented by an enterprise pursuant to the requirements of a statute/ regulator, for example, quarterly financial results presented under SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015 entered into between Stock Exchanges and the listed enterprises; and

- the measurement of income tax expense for the purpose of inclusion in the interim financial reports

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FAQ :

The Guidance Note clarifies the applicability of Accounting Standard (AS) 25 to interim financial results and provides guidance on measuring income tax expense for interim financial reports.

Yes, the Guidance Note specifically addresses whether AS 25 is applicable to interim financial results presented by an enterprise due to statutory or regulatory requirements, such as quarterly results for listed companies.

The Guidance Note covers the measurement of income tax expense for the purpose of inclusion in interim financial reports.

Yes, the 'Guidance Note on Applicability of AS 25 to Interim Financial Results' and the 'Guidance Note on Measurement of Income Tax Expense for Interim Financial Reporting in the Context of AS 25' have been withdrawn.

The Guidance Note was issued by the Institute of Chartered Accountants of India (ICAI).

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