FICCI demands delay in implementation of IFRS
Industry body FICCI has asked the government to delay implementation of international accounting norms, IFRS, beyond April 2011, saying the deadline is "highly unworkable" and "unfair".business Updated: Dec 27, 2010 21:16 IST
Industry body FICCI has asked the government to delay implementation of international accounting norms, IFRS, beyond April 2011, saying the deadline is "highly unworkable" and "unfair".
In a representation to the Corporate Affairs Ministry, FICCI has said that the transition should be brought in when companies are better equipped to deal with the new envisaged accounting concepts and standards.
"Industry (should) be provided at least one year's preparatory time from the date when the harmonised, notified and legislated converged accounting standards and other related matters are in place," FICCI said.
It pointed out that at the current juncture, global standards themselves are up for revision.
Listing the changes, FICCI said that financial instruments, like derivatives, loans, and investments, accounting and reporting framework, accounting for income taxes, revenue recognition, and accounting for employee benefits, are undergoing a major revamp.
FICCI noted that the new Companies Bill is pending finalisation, and so is the Draft Tax Code.
Further, it said that there seems to be some thinking on asking companies to prepare dual set of financial statements, one as per erstwhile Indian GAAP and another as per IFRS.
"This would lead to immense confusion and increase the hardship and cost for these companies," it said.
According to the roadmap laid out by the MCA, companies with a networth of over Rs 1,000 crore will have to prepare their account books as per the IFRS by April 2011.
Further, while scheduled commercial banks and urban cooperative banks will adopt it from April 1, 2013, all insurance companies will convert their opening balance sheets with IFRS from April 2012, while large listed non-banking finance companies (NBFCs), will converge their opening books of accounts with IFRS norms from April 1, 2013.