July 27, 2020
Summary of the notification issued by MCA on 24/07/2020
MCA amends Companies (Indian Accounting Standards) Rules, 2015
Through this notification, MCA has amended the following accounting standards-
Ind AS 1 on Presentation of financial statements, Ind AS 8 on Accounting policies, changes in accounting estimates and errors, Ind AS 10 on Events after the reporting period, Ind AS 34 on Interim financial reporting, Ind AS 37 on Provisions, contingent liabilities and contingent assets, Ind AS 103 on Business combinations, Ind AS 107 on Financial instruments: Disclosures, Ind AS 109 on Financial Instruments, and Ind AS 116 on Leases.
Some of the Key Highlights of the notification are:
- Revised definition of term Business shall be applicable to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after the 1st April, 2020 and to asset acquisitions that occur on or after the beginning of that period and prescribed Fair value concentration test may be opted for assessing the value of business/assets.
- A lessee shall factor in the amendments issued with respect to rent concessions occurring as a direct consequence of the covid-19 pandemic for annual reporting periods beginning on or after the April 1st, 2020. In case a lessee has not yet approved the financial statements for issue before the issuance of this amendment, then the same may be applied for annual reporting periods beginning on or after the April 1st, 2019.
- Definition of the word Material has been revised.