The weekly messenger | Edition 07.21

ACCOUNTING NEWS

Educational Material on Ind AS 105, Non-current Assets Held for Sale and Discontinued Operations – 25 February 2021
 
The ICAI has issued an ‘Educational Material on Ind AS 105 Non-current Assets Hels for Sale and Discontinued Operations’, which provides guidance on accounting and recognition of non-current assets or disposal groups held for sale and presentation and disclosure of discontinued operations. The publication includes:

• Summary of Ind AS 105;
• Frequently Asked Questions (FAQs);
• Major Differences between Ind AS 105 and AS 24;
• Major Differences between Ind AS 105 and IFRS 5.

For more information, click here.
Volume XXXVIII of the Compendium of Opinions – February 2021
 
The Expert Advisory Committee (EAC) of the ICAI has issued the 38^th volume of ‘Compendium of EAC Opinions’, comprising of opinions finalised by it during the period 12 February 2018 to 11 February 2019. Some of the important matters on which the opinions have been provided includes:

• Accounting for discontinuance of service concession arrangement during first-time adoption of Ind AS;
• Presentation of deferred tax recoverable from beneficiaries (customers) accounted as ‘Deferred Asset for Deferred Tax Liability’ under Ind AS;
• Accounting for funded interest term loan (FITL) subsequent to restructuring of a loan taken from a shareholder;
• Treatment of ‘prepayment penalty’ incurred for foreclosure of existing loan and availing new loan/borrowings;
• Accounting for provision to be created for onerous contract.

For more information, click here. 
Study on Compliance of Financial Reporting Requirements (Ind AS Framework) – February 2021
 
The Financial Reporting Review Board (FRRB) of the ICAI has issued a publication namely ‘Study on Compliance of Financial Reporting Requirements (Ind AS Framework)’. This publication includes the instances of common non-compliances for information of members and various other stakeholders to enable them to move towards better quality financial reporting. It also covers non-compliances observed relating to Schedule II and Schedule III of the Companies Act, 2013, Standards on Auditing and CARO 2016.
 
For more information, click here.

REGULATORY NEWS

MCA & CBIC sign MoU for exchange of data for enhancing Ease of Doing Business in India and improve overall regulatory enforcement – 25 February 2021
 
A Memorandum of Understanding (MoU) has been signed between the Ministry of Corporate Affairs (MCA) and the Central Board of Indirect Taxes and Customs (CBIC), for the purpose of sharing the data amongst themselves on an automatic and regular basis.
 
For more information, click here.
 
MCA advises investors to verify status of Nidhi companies before investment - 25 February 2021
 
On examining the applications filed by the Nidhi Companies in form NDH-4 ‘Form for filing application for declaration as Nidhi Company and for updation of status by Nidhis’, the Central Government (CG) has observed that some of these companies have not been complying with the provisions of the Nidhi Rules, 2014 completely, due to which their applications have been rejected, considering them unfit to be declared as Nidhi Company.
 
Therefore, the CG has advised the investors of such companies to verify the antecedents / status of a Nidhi Company especially their declaration of their status as Nidhi Company by the CG before becoming its member and investing their hard-earned money in such companies.
 
For more information, click here.
 
Prudent management of financial resources of insurers in the context of Covid-19 pandemic – 25 February 2021
 
The Insurance Regulatory and Development Authority of India (IRDAI), vide its Circular dated 24 April 2020, had refrained the insurers from paying out dividend from their profits pertaining to the financial year 2019-20, till further instructions.
 
Now after assessing the situation, based on the financial results of the insurers for the quarters ending 30 September 2020 and 31 December 2020, the IRDAI has decided to withdraw the applicability of the aforesaid Circular and allowed the insurers to take a conscious call for declaration of dividends for the Financial year 2020-21, considering their capital, solvency and liquidity positions.
 
For more information, click here.