MCA notifies Companies (Indian Accounting Standards) Amendment Rules, 2021.
G.S.R. 419(E).—In exercise of the powers conferred by section 133, read with section 469 of the Companies Act, 2013 (18 of 2013), the Central Government, in consultation with the National Financial Reporting Authority, hereby makes the following rules further to amend the Companies (Indian Accounting Standards) Rules, 2015, namely:-
- Short title and commencement.-
(1) These rules may be called the Companies (Indian AccountingStandards) Amendment Rules, 2021.
(2) They shall come into force on the date of their publication in the Official Gazette. - In the Companies (Indian Accounting Standards) Rules, 2015, in the 1’Annexure, under the heading “B.
Indian Accounting Standards (Ind AS),-
(A) in “Indian Accounting Standard (Ind AS) 101, in “Appendix B,-
(i) in paragraph B1, for item (d), the following shall be substituted, namely:-
(d) classification and measurement of financial instruments (paragraphs B8-B8C);
(ii) for heading before paragraph B8, the following shall be substituted, namely:-
“Classification and measurement of financial instruments”;
(B) in “Indian Accounting Standard (Ind AS) 102”, –
(i) after paragraph 63D, the following shall be inserted, namely:-
“63E Amendments to References to the Conceptual Framework in Ind AS issued in 2021 amended the footnote to the definition of an equity instrument in Appendix A. An entity shall apply that amendment for annual periods beginning on or after 1 April, 2021. An entity shall apply the amendment to Ind AS 102 retrospectively, in accordance with Ind AS 8, Accounting Policies, Changes in Accounting Estimates and Errors. However, if an entity determines that retrospective application would be impracticable or would involve undue cost or effort, it shall apply the amendment to Ind AS 102 by reference to paragraphs 23–28, 50–53 and 54F of Ind AS 8.”;
(ii) in Appendix A, for the footnote relating to ―equity instrument‖, the following shall be substituted, namely:-
“* The Conceptual Framework for Financial Reporting under Indian Accounting Standards (Conceptual Framework) issued by the Institute of Chartered Accountants of India, defines a liability as a present obligation of the entity to transfer an economic resource as a result of past events.”;
(C) in “Indian Accounting Standard (Ind AS) 103”, for paragraph 11, the following shall be substituted, namely:-
“11 To qualify for recognition as part of applying the acquisition method, the identifiable assets acquired and liabilities assumed must meet the definitions of assets and liabilities in the Framework for the Preparation and Presentation of Financial Statements in accordance with Indian Accounting Standards* issued by the Institute of Chartered Accountants of India at the acquisition date. For example, costs the acquirer expects but is not obliged to incur in the future to effect its plan to exit an activity of an acquiree or to terminate the employment of or relocate an acquiree‘s employees are not liabilities at the acquisition date. Therefore, the acquirer does not recognise those costs as part of applying the acquisition method. Instead, the acquirer recognises those costs in its post-combination financial statements in accordance with other Ind AS.”;
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