The weekly messenger | Edition 22.16
This newsletter is a weekly compilation of accounting, auditing and related regulatory news from different accounting and regulatory bodies in India and overseas.
Accounting News
GN on accounting for Oil and Gas producing activities – 13 December 2016
The Institute of Chartered Accountants of India (ICAI) has issued a Guidance Note (GN) on Accounting for oil and gas producing activities, for entities whose financial statements have been prepared and presented in accordance with Ind AS, to stablish sound accounting principles related to acquisition, exploration, development and production activities. The GN, inter-alia, includes:
- Objective
- Scope
- Definition
- Classification of activities and related costs
- Accounting for “Acquisition”, “Exploration and Evaluation” and “Development costs”
- Depreciation
- Accounting for Production costs
- Accounting for cost of support equipment and facilities
- Accounting for abandonment costs
- Presentation
- Disclosure etc.
The GN comes into effect in respect of accounting periods commencing on or after 1 April 2017, its earlier application is encouraged.
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FASB issues targeted changes to key areas of accounting guidance – 14 December 2016
The Financial Accounting Standards Board (FASB) has issued an accounting standard update (ASU) in which it has clarified and removed inconsistencies in key areas of U.S. Generally Accepted Accounting Principles (GAAP). It applies to all reporting organizations within the scope of the affected accounting guidance, including public companies, private companies and not for profit organizations. Some of the topics in which amendments have been made are as follows:
- Retirement benefits-Defined Benefit Plans-Pension
- Retirement benefits-Defined Benefit Plans- Other Post retirement
- Financial Services—Insurance
- Financial Instruments
- Intangibles—Goodwill and Other
- Property, Plant, and Equipment—Real Estate Sales
- Fair Value Measurement
- Liabilities—Obligations Resulting from Joint and Several Liability Arrangements
- Transfers and Servicing—Sales of Financial Assets
- Transfers and Servicing—Servicing Assets and Liabilities
Most of the amendments are effective immediately and others take effect for interim and annual reporting periods beginning after 15 December 2016.
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IASB publishes formal corrections – 14 December 2016
The International Accounting Standard Board (IASB) has issued certain formal editorial corrections to International Financial Reporting Standards (IFRS) 15, Revenue from contracts with customers and IFRS 9, Financial Instruments.
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Regulatory News
ICAI issue mandatory KYC norms – 10 December 2016
ICAI has formulated Know Your Client (KYC) norms for its members who are in practice. These norms are mandatory and shall apply in all assignments pertaining to attest function. Different norms have been specified for following categories of clients:
- Where client is an individual/proprietor
- Where client is a corporate entity
- Where client is a non-corporate entity
These norms shall come into force from 1 January 2017.
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NCLT (Procedure for reduction of share capital of company) Rules, 2016 – 15 December 2016
The Ministry of Corporate Affairs (MCA) has formulated National Company Law Tribunal (NCLT) (Procedure for reduction of share capital of company) Rules, 2016. These rules, inter-alia, includes following:
- Form of application or petition for reduction of share capital under section 66
- Issue of notice and directions by NCLT
- Representation by Central Government, Registrar etc.
- Procedure with regard to representations and objections received
- Order on application and minute thereof
These rules shall come into force on the date of publication in official gazette.
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Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 – 14 December 2016
MCA has formulated Companies (Compromises, Arrangements and Amalgamations) Rules, 2016. These rules shall, inter-alia, includes following:
- Application for order of a meeting
- Disclosures in application made to the Tribunal for compromise or arrangement
- Directions at the hearing of the application
- Notice of meeting
- Advertisement of notice of meeting
- Notice to statutory authorities
- Voting
- Proxies
- Affidavit of service
- Result of meeting to be declared by voting etc.
These rules shall come into effect from 15 December 2016.
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