The weekly messenger | Edition 21.18

Accounting News

FAQ on accounting treatment of increase in liability due to enhancement of the gratuity ceiling – 14 May 2018

The Institute of Chartered Accountants of India (ICAI) has issued a Frequently Asked Question (FAQ) on accounting treatment of increase in liability due to enhancement of the gratuity ceiling from Rs. 10 lakhs to Rs. 20 Lakhs pursuant to the Payment of Gratuity (Amendment) Act 2018 in order to provide clarification w.r.t. same. In the given FAQ, the ICAI has clarified that the effect of this amendment need to be dealt with reference to accounting treatment of past service costs both as per Accounting Standard (AS) as well as Indian Accounting Standard (Ind AS) which should be accounted for as an expense since, the accounting standards do not provide any exemption/one time relief in this regard.

For more information, click here.

ED of AS 109, Financial Instruments – 16 May 2018

The ICAI has also issued the Exposure Draft (ED) of AS – 109 ‘Financial Instrument’ for the non-Ind AS compliant companies as currently there is no comprehensive robust standard on financial instruments under existing ASs.

Comments are to be received by 30 June 2018.

For more information, click here.

Auditing News

ED of Standard on Internal Audits– 17 May 2018

The Internal Audit Standards Board (IASB) of ICAI has issued the EDs on various new Standards on Internal Audit (SIA), the listing of which is as follows:

• SIA on Managing the Internal Audit Function (A);
• SIA on Internal Audit Documentation (B);
• SIA on Internal Audit Evidence (C);
• SIA on Conducting Overall Internal Audit Planning (D);
• SIA on Planning the Internal Audit Assignment (E).

For (A), click here; (B), click here; (C), click here; (D), click here; (E), click here.

Regulatory News

Corrigendum related to Companies (Audit and Auditors) Second Amendment Rules, 2018 – 17 May 2018

The Central Government (CG) has issued the Companies (Audit and Auditors) Amendment Rules, 2018 vide its notification no. G.S.R. 432(E) dated 7 May 2018. Now, the CG has issued a corrigendum w.r.t. the aforesaid rules wherein it has replaced the word ‘amendment’ with the words ‘second amendment’, since the CG has already issued the Companies (Audit and Auditors) Amendment Rules, 2018 vide its notification no. G.S.R. 174(E) dated 16 February 2018.

For more information, click here.

Clarification – Condonation of Delay Scheme 2018 – 17 May 2018

The Ministry of Corporate Affairs (MCA) had issued condonation of delay scheme (CODS) 2018 in December 2017. Now a clarification has been provided on the said Scheme. As per this clarification, if a company whose name was struck off from the register of the companies, who had filed petitions before National Company Law Tribunal (NCLT) and the order from NCLT was received after 1 May 2018, in that case can this company file CODS. For this purpose, MCA directed that in such case ROC shall raise a ticket through Change Requirement Form (CRF) on MCA 21 portal along with copy of NCLT order and E-governance shall activate DIN of the directors of such struck off companies that have been revived through NCLT to file e-CODS, 2018.

For more information, click here.

Consultation Paper for review of SEBI (LODR) Regulations, 2015 - 14 May 2018

The SEBI has issued a Consultation Paper for review of SEBI (Listing Obligations and Disclosure Requirements (LODR)) Regulations, 2015 wherein it has proposed certain changes in the existing listing regulations w.r.t. the listed entities which have listed its Non-convertible debt securities or Non-convertible redeemable preference shares or both.

For more information, click here.

Basel III Framework on Liquidity Standards – NSFR – Final Guidelines – 17 May 2018

The Net Stable Funding Ratio (NSFR) and Liquidity Coverage Ratio (LCR) are significant components of the Basel III reforms. The LCR guidelines which promote short term resilience of a bank’s liquidity profile were issued vide circular dated 9 June 2014. On the other hand, the guidelines w.r.t. the NSFR which ensure reduction in funding risk over a longer time horizon by requiring banks to fund their activities with sufficiently stable sources of funding in order to mitigate the risk of future funding stress were in draft stage. Now, the Reserve Bank of India, after considering the comments received from various stakeholders, has issued the Basel III Framework on Liquidity Standards –NSFR – Final Guidelines.

For more information, click here.

Further GST Updates

The Central Board of Excise and Customs has issued certain updates w.r.t. Goods and Services Tax (GST) whose links are as follows:
For information w.r.t. waiver of late fee for FORM GSTR – 3B, click here;

For extension of due date for filing of FORM GSTR – 3B for the month of April, 2018, click here.