The weekly messenger | Edition 39.17

Accounting News

ED on AS - 23 Borrowing Cost and AS - 24 Related Party Disclosures – 5 October 2017

The Institute of Chartered Accountants of India (ICAI) has issued Exposure Drafts (EDs) on Accounting Standard (AS) - 23, Borrowing Costs and AS - 24, Related Party Disclosures. The purpose of issuing these EDs is to upgrade the AS as notified under Companies (AS) Rules 2006, to bring them nearer to Indian (Ind) AS which will be applicable to all companies having net-worth less than Rs.250 crores including non-corporate entities.

Comments are to be received by 31 October 2017.

For AS – 23 Borrowing Costs, click here;

For AS – 24, Related Party Disclosures, click here.

FASB proposes various minor changes to codification – 4 October 2017

The Financial Accounting Standard Board (FASB) has issued a proposed Accounting Standard Update (ASU) that would make changes designed to clarify, correct errors in, or make minor improvements to the board’s Accounting Standards Codification. The proposal addresses clarifications and guidance that are not expected to have a significant effect on current accounting practices or create a significant administrative cost to most entities. The proposed amendments would affect the following topics:

• Subtopic 220-10, Comprehensive Income-Overall;
• Subtopic 470-50, Debt-Modifications and Extinguishments;
• Subtopic 480-10, Distinguishing Liabilities from Equity-Overall;
• Subtopic 718-740,Compensation-Stock Compensation-Income taxes;
• Subtopic 805-740,Business Combinations-Income Taxes;
• Subtopic 815-10, Derivatives and Hedging Overall;
• Subtopic 820-10, Fair Value Measurement-Overall;
• Subtopic 940-405, Financial Services-Brokers and Dealers- Liabilities; and
• Subtopic 962-325, Plan accounting-Defined Contribution Pension Plans-Investments-Other.

Comments are to be received by 4 December 2017.

For more information, click here

Auditing News

PCAOB Publishes Staff Audit Practice Alert on Auditing the New AS for Revenue – 5 October 2017

The Public Company Accounting Oversight Board (PCAOB) has published a staff audit practice alert no.15 - Matters Related to Auditing Revenue from Contracts with Customers. This practice alert has been  issued to assist auditors in certain significant matters relating to the application of PCAOB standards relevant to auditing the implementation of the new AS for revenue from contracts with customers issued by the FASB.It provides guidance on transition disclosures/adjustments, internal control over financial reporting, fraud risks and revenue recognition.

For more information, click here

Regulatory News

ICAI invites suggestions for pre-budget memorandum 2018 – 4 October 2017

The Direct Taxes Committee, Indirect Taxes Committee and Committee on International Taxation of the ICAI are in the process of identifying issues for inclusion in the Pre-Budget Memorandum - 2018 to be submitted to the Ministry of Finance or respective State Ministry. For this, they have invited suggestions on laws relating to Direct Taxes (including International Taxation) and Indirect Taxes w.r.t. the following topics:

• Suggestions for widening the tax base and increasing the tax revenue;
• Suggestions to check tax avoidance;
• Suggestions to reduce/minimize litigations;
• Suggestions for rationalization of the provisions of Direct Tax Laws;
• Suggestions for removing administrative and procedural difficulties;
• Goods & Services Tax (GST);
• Customs Law;
• Central Excise Law (to the extent applicable on specific goods);
• The suggestions for widening the tax base, increasing the tax revenue, check tax avoidance and to reduce/minimize litigations may also be provided.

Suggestions are to be submitted latest by 10 October 2017.

For more information, click here

Amendments to the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 and the Insolvency and Bankruptcy Board of India (Fast Track Insolvency Resolution Process for Corporate Persons) Regulations, 2017 – 5 October 2017

The Insolvency and Bankruptcy Board of India has amended the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 and Insolvency and Bankruptcy Board of India (Fast Track Insolvency Resolution Process for Corporate Persons) Regulations, 2017. As per the amended regulations, a resolution plan shall include a statement as to how it has dealt with the interests of all stakeholders, including financial creditors and operational creditors, of the corporate debtor.

For More information, click here

Submission of report of the Committee on Corporate Governance – 5 October 2017

The Securities and Exchange Board of India (SEBI) had formed a Committee in June 2017 to enhance the standards of corporate governance of listed entities in India. The purpose of this Committee was to make recommendations to SEBI on the following issues:

• ensuring independence in spirit of Independent Directors and their active participation in functioning of the company;
• improving safeguards and disclosures pertaining to Related Party Transactions;
• issues in accounting and auditing practices by listed companies;
• improving effectiveness of Board Evaluation practices;
• addressing issues faced by investors on voting and participation in general meetings;
• disclosure and transparency related issues, if any;
• any  other  matter,  as  the  Committee  deems  fit  pertaining  to  corporate  governance  in India.

The Committee has now submitted its report on 5 October 2017.

Comments are to be received by 4 November 2017.

For more information, click here

Further GST Updates

The Central Board of excise and Customs (CBEC) has issued certain updates w.r.t. GST   whose links are as follows: 

• For clarification on issues related to furnishing of Bond/Letter of undertaking (LUT) for exports, click here;
• For recommendations made by the GST Council in the 22nd meeting at New Delhi on 6th October, 2017, click here;
• For change in GST Rates for certain goods and Integrated GST Rates on import of certain goods, click here.