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Background
The Ministry of Corporate Affairs (MCA), through its notification dated 16 February 2015, issued 39 Indian Accounting Standards (Ind AS), which are converged with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB). On 22 July 2015, IASB deferred the applicability of IFRS 15, Revenue from Contracts with Customers by one year to 2018. Consequently, the regulators in India such as MCA and the Institute of Chartered Accountants of India (ICAI) deferred Ind AS 115, Revenue from Contracts with Customers, which is based on IFRS 15 and notified two standards - Ind AS 11, Construction Contracts and Ind AS 18, Revenue that were applicable to entities transitioning to Ind AS from 1 April 2016 onwards.
New development
As a result of the discussions of the Transition Resource Group (TRG) which was set up jointly by the IASB and the U.S. Financial Accounting Standards Board (FASB), on 12 April 2016, the IASB issued amendments to IFRS 15. These amendments did not change the underlying principles of IFRS 15 but clarified some requirements and provided additional transitional relief to companies that were implementing IFRS 15.
To keep Ind AS updated with revisions made to IFRS, in order to maintain convergence, similar amendments were required in the Indian context. Accordingly, on 26 April 2017, the ICAI issued an Exposure Draft on Clarifications to Ind AS 115 (Exposure Draft). This Exposure Draft also proposes that Ind AS 115 would be applicable for accounting periods beginning on or after 1 April 2018.
The last date for comments on the exposure draft is 16 May 2017.
This issue of IFRS notes provides an overview of the amendments proposed in the Exposure Draft by the ICAI.
To access the text of the exposure draft on Clarifications to Ind AS 115, click here
To access complete KPMG report click here
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