Central Government to prescribe accounting standards.
Section 133 of the Companies Act, 2013 States that the government can set rules for accounting, but only after considering recommendations from the Institute of Chartered Accountants of India (ICAI) and another group called the National Financial Reporting Authority (NFRA).
For now, before the NFRA is formed, the government can still set accounting rules after consulting with the ICAI and a group called the National Advisory Committee on Accounting Standards.
Complete text of section 133 of the companies act, 2013
The Central Government may prescribe the standards of accounting or any addendum thereto, as recommended by the Institute of Chartered Accountants of India, constituted under section 3 of the Chartered Accountants Act, 1949 (38 of 1949), in consultation with and after examination of the recommendations made by the National Financial Reporting Authority.
1[Provided that until the National Financial Reporting Authority is constituted under section 132 of the Companies Act, 2013 (18 of 2013), the Central Government may prescribe the standards of accounting or any addendum thereto, as recommended by the Institute of Chartered Accountants of India, constituted under section 3 of the Chartered Accountants Act, 1949 (38 of 1949), in consultation with and after examination of the recommendations made by National Advisory Committee on Accounting Standards Constituted under section 210A of the Companies Act, 1956”.]
Amendment
Applicable rules with respect to section 133 of the companies act 2013
Transitional Provisions with Respect to Accounting Standards
(2) Till the National Financial Reporting Authority is constituted under section 132 of the Act, the Central Government may prescribe the standards of accounting or any addendum thereto, as recommended by the Institute of Chartered Accountants of India in consultation with and after examination of the recommendations made by the National Advisory Committee on Accounting Standards constituted under section 210A of the Companies Act, 1956 (1 of 1956).
The Companies (Indian Accounting Standards) Rules, 2015
In exercise of the powers conferred by section 133 read with section 469 of the Companies Act, 2013 (18 of 2013) and sub-section (1) of section 210A of the Companies Act, 1956 (1 of 1956), the Central Government, in consultation with the National Advisory Committee on Accounting Standards, hereby makes the following rules, namely:-
Rule 3 of The Companies (Indian Accounting Standards) Rules, 2015
Applicability of Accounting Standards.-
(1) The accounting standards as specified in the Annexure to these rules to be called the Indian Accounting Standards (Ind AS) shall be the accounting standards applicable to classes of companies specified in rule 4.
(2) The Accounting standards as specified in Annexure to the Companies (Accounting Standards) Rules, 2006 shall be the Accounting Standards applicable to the companies other than the classes of companies specified in rule 4.
(3) A company which follows the Indian Accounting Standards (Ind AS) specified in Annexure to these rules inaccordance with the provisions of rule 4 shall follow such standards only.
(4) A company which follows the accounting standards specified in Annexure to the Companies (AccountingStandards) Rules, 2006 shall comply with such standards only and not the Standards specified in Annexure tothese rules.
Annexure to the the Companies (Indian Accounting Standards) Rules, 2015
A. General Instruction.-
(1) Indian Accounting Standards, which are specified, are intended to be in conformity with the provisions of applicable laws. However, if due to subsequent amendments in the law, a particular Indian Accounting Standard is found to be not in conformity with such law, the provisions of the said law shall prevail and the financial statements shall be prepared in conformity with such law.
(2) Indian Accounting Standards are intended to apply only to items which are material.
(3) The Indian Accounting Standards include paragraphs set in bold italic type and plain type, which have equal authority. Paragraphs in bold italic type indicate the main principles. An individual Indian Accounting Standard shall be read in the context of the objective, if stated, in that Indian Accounting Standard and in accordance with these General Instructions.
Notified Indian Accounting Standards
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