The weekly messenger | Edition 30.18

Accounting News

Implementation of Ind AS 115, Revenue from Contracts with Customers in context of Real Estate Sector – 20 July 2018

The Institute of Chartered Accountants of India (ICAI) after considering the misleading and confusing media reports which states Indian Accounting Standard (Ind AS) 115, ‘Revenue from Contracts with Customers’ permits only Completed Contract Method of accounting for real estate companies (i.e. “revenue in case of real estate transactions can be booked only after the project is completed and the customer has taken possession of the unit (house/flat)”) has issued a clarification wherein it has clarified that Ind AS 115 does allow recognition of revenue using Percentage of Completion Method (POCM) and has explicit and specific requirements to recognise revenue, where performance obligation is satisfied over a period of time as per paragraphs 35 -37 of the aforesaid standard.
 
For more information, click here.
 

Regulatory News

MCA to update KYC to directors | New E - Form DIR - 3 KYC has been notified – 26 July 2018

The ICAI has issued an announcement with respect to the newly introduced concept of submission of a new form DIR – 3 KYC which is required to be submitted by all the directors of the companies, wherein the ICAI has provided a list of certain points which are to be taken into account, while providing the details and information in Form DIR – 3 KYC such as:

• Due date of filing of the aforesaid form;
• Particulars of information which is mandatorily required to be filled by the directors;
• Certification of the aforesaid form by practicing professionals etc.

For more information, click here.

Consultation Paper on 'Revisiting the public issue process' – 25 July 2018

The Securities and Exchange Board of India (SEBI), after considering the significant developments that have been taking place in the payment mechanisms, has issued the Consultation Paper on ‘Revisiting the public issue process’, wherein it has proposed the use of Unified Payments Interface (UPI),  a process  for  electronic  funds  transfer launched by Reserve  Bank  of  India (RBI) and  National  Payments  Corporation  of  India (NPCI) in March 2016, with Applications Supported by Blocked Amount (ASBA) mechanism to further improve the efficiency of the process for public issue.
Comments are to be received by 15 August 2018.

For more information, click here.

Discussion paper on Delisting of Equity Shares Review of 'Reverse Book Building Process' - 26 July 2018

The SEBI has issued a Discussion Paper on Delisting of Equity Shares – Review of ‘Reverse Book Building Process’ for public comments wherein the SEBI has proposed to amend the present form of Reverse Book Building considering the various issues being encountered by the stakeholders.
The comments are to be received by 16 August 2018.

For more information, click here.

Prudential Norms for Classification, Valuation and Operation of Investment Portfolio by banks - Valuation of State Development Loans - 27 July 2018

The RBI had issued the ‘Statement on Developmental and Regulatory Policies’ on 6 June 2018 wherein, it had prescribed that securities issued by each state government i.e. State Development Loans (SDLs) shall be valued based on observed prices. However, the RBI, has now decided that such securities shall be valued in a manner, which would objectively reflect their fair value based on observed prices/yields which would be provided by the Financial Benchmarks India Pvt. Ltd. (FBIL) with effect from 30 September 2018 and till then, banks shall continue to value SDLs as per the valuation method prescribed under Circular DBR.No.BP.BC.6/21.04.141/2015-16 dated 1 July 2015 as per which these securities are required to be valued by applying the Yield to Maturity (YTM) method by marking it up by 25 basis points above the yields of the Central Government Securities of equivalent maturity put out by Primary Dealers Association of India(PDAI)/Fixed Income Money Market and Derivatives Association of India (FIMMDA) periodically. 

For more information, click here.

Extension of date of filing of Income Tax Returns - 26 July 2018

The Central Board of Direct Taxes has extended the due date for filing of Income Tax Returns for AY 2018-19 from 31 July 2018 to 31 August 2018 for certain categories of taxpayers i.e. the taxpayers who are required to file their returns by 31 July 2018.

For more information, click here.

The Prevention of Corruption (Amendment) Act, 2018 - 26 July 2018

The Prevention of Corruption Act, 1988 has been amended by the Prevention of Corruption (Amendment) Act, 2018 wherein, various sections have been amended and certain new sections have also been added which inter-alia includes:

• Section 2 ‘Definitions’;
• Section 4 ‘Cases triable by special Judges’;
• Sections 7 ‘Offence relating to public servant being bribed’;
• Section 8 ‘Offence relating to bribing of a public servant’;
• Section 9 ‘Offence relating to bribing a public servant by a commercial organisation’;
• Section 10 ‘Person in charge of commercial organisation to be guilty of offence’;
• Section 11 ‘Public servant obtaining valuable thing, without consideration from person concerned in proceeding or business transacted by such public servant’;
• Section 12 ‘Punishment for abetment of offences’;
• Section 13 ‘Criminal misconduct by a public servant’; etc.

For more information, click here.

Further GST Updates

The Central Board of Indirect Taxes and Customs has issued certain updates w.r.t. Goods and Services Tax (GST) whose links are as follows: 

• For information w.r.t GST law amendment, click here;
• For information w.r.t rates of various services as recommended by GST council, click update 1, update 2, and update 3;
• For information w.r.t exemption of certain services as recommended by the GST council, click update 1, update 2, and update 3;
• For information w.r.t specific services supplied by individual Direct Selling Agents (DSAs) to banks/ non-banking financial company (NBFCs) to be taxed under Reverse Charge Mechanism (RCM), click update 1, update 2, and update 3;
• For information w.r.t treatment of services by way of any activity in relation to a function entrusted to a municipality under Article 243W neither as a supply of good nor a service, click update 1, update 2, and update 3;
• For information w.r.t insertion of an explanation in an item, click update 1, update 2, and update 3;
• For information w.r.t the recommendations of the GST Council in its 28th meeting w.r.t. Schedule I, II, III and IV, click update 1, update 2, and update 3;
• For information w.r.t amendments in the Schedule prescribed in notification No. 2/2017 dated 28 June 2017, click update 1, update 2, and update 3;
• For information w.r.t insertion of new proviso in the opening paragraph in notification No. 5/2017 dated 28 June 2017, click update 1, update 2, and update 3;
• For information w.r.t concessional rate on specified handicraft items, click update 1, update 2, and update 3; and

For information w.r.t the recommendations of the GST Council in its 28th meeting w.r.t. compensation cess (rate),click here.