presentation-accounting standards-.ppt

8/10/2019 Presentation-Accounting Standards-.ppt

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Accounting Standards


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Session overview Every profession develops a body of knowledge

consisting of principles, which are considered as

standard to be attained. Accounting is no exception.

In India, the Institute of Chartered Accountants of

India has developed Accounting Standards; based on

the generally accepted accounting standards to beused in preparation of financial statements.


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Session coverage

During this session, we will learn:

the importance of the accounting standards

in preparation of financial statements; and

application of AS 1 relating to Disclosure

of Accounting Policies, and

application of AS 4 relating to Events

Occurring After the Balance Sheet Date for

preparation of financial statements.


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Learning Objective

At the end of the session, the learner will be

able to state the importance of Accounting

Standards in the preparation of financialstatements and application of AS 1 relating

to Disclosure of Accounting Policies and

AS 4 relating to EventsOccurring After theBalance Sheet Date in the preparation of

Financial Statements.


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Importance of Accounting

Standards The users of the financial statements need

an assurance that the entities preparing their

financial statements follow the acceptedstandards while presenting their financial

information in the financial statements.


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LIST OF ACCOUNTING

STANDARDS ISSUED SO FAR Institute of Chartered Accountants of India

has so far issued 29 Accounting Standards

on the advise of the accounting StandardsBoard


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LIST OF ACCOUNTING

STANDARDS ISSUED SO FAR AS 1-Disclosure of Accounting Policies

AS 2-Valuation of Inventories

AS 3-Cash flow Statements

AS 4-Contingencies and Events Occurring After

the Balance Sheet Date

AS 5 -Net Profit or Loss for the Period, PriorPeriod Items and Changes in Accounting Policies

AS 6-Depreciation Accounting


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LIST OF ACCOUNTING

STANDARDS ISSUED SO FAR AS 7-Accounting for Construction Contracts

AS 8-Accounting for Research and Development

AS 9-Revenue Recognition

AS 10-Accounting for Fixed Assets

AS 11-Accounting for the Effects of Changes in

Foreign Exchange Rates AS 12-Accounting for Government Grants


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LIST OF ACCOUNTING

STANDARDS ISSUED SO FAR AS 13-Accounting for Investments

AS 14-Accounting for Amalgamations

AS 15-Accounting for Retirement Benefits in thefinancial Statements of Employers

AS 16-Borrowing Costs

AS 17-Segment Reporting AS 18-Related Party Disclosures

AS 19-Leases


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LIST OF ACCOUNTING

STANDARDS ISSUED SO FAR AS 20-Earnings Per Share

AS 21-Consolidated Financial Statements

AS 22-Accounting for Taxes on Income

AS 23-Accounting for Investments inAssociates in Consolidated Financial

Statements AS 24-Discontinuing Operations

AS 25-Interim Financial Reporting


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LIST OF ACCOUNTING

STANDARDS ISSUED SO FAR AS 26-Intangible Assets

AS 27-Financial Reporting of Interests in

Joint Ventures

AS 28-Impairment of Assets

AS 29-Provisions, contingent Liabilities and

Contingent Assets


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Accounting Standard (AS 1)

Disclosure of Accounting

Policies


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AS 1Disclosure of Accounting Policies

Fundamental Accounting Assumptions

Accounting Policies


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Fundamental Accounting

Assumptions Going concern

Consistency

Accrual


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Areas in which differing accounting

Policies are encounteredMethods of depreciation, depletion and

amortization;

Treatment of expenditure duringconstruction;

Conversion or translation of foreigncurrency items;


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Policies are encounteredValuation of inventories;

Treatment of goodwill;

Valuation of investments;

Treatment of retirement benefits;


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Policies are encounteredRecognition of profit on long-term

contracts;

Valuation of fixed assets;

Treatment of contingent liabilities.


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Considerations in the selection

of Accounting PoliciesPrudence

Substance over form

Materiality


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Accounting Standard-1

If the fundamental accounting

assumptions, viz., going concern,

consistency and accrual are followed infinancial statements, specific disclosure is

not required. If a fundamental

accounting assumption is not followed,the fact should be disclosed.


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Accounting Standard (AS) 4 -Contingencies and Events

Occurring After the Balance

Sheet Date


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Accounting Standard-4

Does not apply to:

(a) Liabilities of life assurance and general

insurance enterprises arising from policies issued; (b) Obligations under retirement benefit plans;

and

Commitments arising from long-term lease

contracts.


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Definitions

A contingencyis acondition or situation,the ultimate outcome

of which, gain or loss,will be known ordetermined only onthe occurrence or non-

occurrence of one ormore uncertain futureevents.

Events after the balancesheet dateare thosesignificant events, both

favourable andunfavourable, that occurbetween the balance sheetdate and the date on whichthe financial statements

are approved by the Boardof Directors

represent mater ialchanges and

commitments affecting

the f inancial position of

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