The weekly messenger | Edition 19.20

Accounting News

IASB issues amendment to IFRS Standard on leases to help lessees accounting for COVID-19-related rent concessions – 28 May 2020

The International Accounting Standards Board (IASB) has issued an amendment to IFRS 16 Leases, in order to make it easier for lessees to account for COVID-19-related rent concessions such as rent holidays and temporary rent reductions.
 
The amendment exempts the lessees from having to consider individual lease contracts to determine whether rent concessions occurring as a direct consequence of the COVID-19 pandemic are lease modifications and allows lessees to account for such rent concessions, as if they were not lease modifications.
 
The amendment applies to COVID-19-related rent concessions that reduce lease payments due on or before 30 June 2021.
 
The amendment is effective 1 June 2020 but, to ensure the relief is available when needed most, lessees can apply the amendment immediately in any financial statements-interim or annual-not yet authorised for issue.

Auditing News

Further extensions regarding the validity of Peer Review Certificate in the wake of COVID-19 spurt across the country – 29 May 2020

In the wake of COVID-19 spurt and extension of the nation-wide lock down, the ICAI has granted further extension with respect to the validity of Peer Review Certificate, in case of Practice Units, which are already holding a valid Peer Review Certificate but whose Peer Review process needs to be initiated.
 
In such scenarios, the ICAI has clarified that if the Peer Review Process needs to be initiated and the validity of the certificate is expiring after Lockdown till 30 September 2020, then in that case, the effective date of validity of Peer Review Certificate stands extended till 31 March  2021. Further, in such cases, the Practice units have to get their peer review completed and submit the final clean report to the Board before 31 March 2021. 
 
For more information, click here.

Advisory for Members of the ICAI and Companies to whom CSR provisions under Companies Act, 2013 apply – 29 May 2020

The ICAI has issued an ‘Advisory for its Members and Companies to whom Corporate Social Responsibility (CSR) provisions under Companies Act, 2013 apply’, wherein it has advised that the companies which are undertaking their CSR activities through a third party/NGO, are required to obtain an ‘Independent Practitioner’s Report on Utilisation of CSR Funds’, from the auditor/ CA in practice of such third party/ NGO as per the Guidance Note on Reports/ Certificates for Special Purposes issued by the ICAI.
 
The ICAI has also provided the draft format of the aforesaid report, which is yet to be finalised by the Auditing and Assurance Standards Board of the ICAI.
 
For more information, click here.

Regulatory News

Amendment of item no.(viii) in the Schedule VII of the Companies Act, 2013 – 26 May 2020

The Central Government has made further amendments in the Schedule VII ‘Activities which may be included by Companies in their Corporate Social Responsibility Policies’ to the Companies Act, 2013, wherein in item no. (viii) of the aforesaid schedule, after the words ‘Prime Minister’s National Relief Fund’, the words ‘or PM CARES Fund’ have been inserted.

For more information, click here.