Page 28 - ISCDEBK-XI

4.2 Double Entry Book Keeping—ISC XI
• Objectives of IASB are:

(i) To develop, in the public interest, a single set of high-quality, understandable, and enforceable global
accounting standards that require high-quality, transparent, and comparable information in financial
statements and other financial reporting to help participants in the various capital markets of the
world and other users of the information to make economic decisions;
(ii) To promote the use and rigorous application of those standards;
(iii) In fulfilling the objectives associated with (i) and (ii), to take account of, as appropriate, the special
needs of small and medium-sized entities and emerging economies; and
(iv) To bring about convergence of national accounting standards and International Financial Reporting
Standards to high-quality solutions.
• Benefits of IFRS are to investors, industry and professionals worldwide.
• Difference between IFRS and Indian Accounting Standards. The principal difference between the two is
that while IFRS are based on principle and fair value, Indian Accounting Standards are based on rules and
historical value.
• India has decided to converge Indian Accounting Standards with IFRS and has issued IFRS equivalent
accounting standards titled ’Ind-AS’.

Accounting Standards

Accounting Standards are the policy document guiding the measurement, treatment and
disclosure of financial or accounting transactions. They are issued by the accountancy body

such as the Institute of Chartered Accountants of India (ICAI). In other words, accounting
standards are the guidelines for accounting policies and practices to be adopted and followed
in accounting and presentation of financial statements.

A regulated financial accounting process ensures consistency, reliability, comparability
and correctness of financial statements. Accounting standards guide the measurement and
treatment of financial transactions and their disclosure in the financial statements.

In India, accounting standards have been formulated and issued by the Institute of Chartered
Accountants of India (ICAI). They are applicable on the entities, other than companies, for
preparation and presentation of financial statements. The Companies Act, 2013 has recognised
these accounting standards (Accounting Standard-1 to Accounting Standard-29) issued by the
Institute of Chartered Accountants of India that are followed by the companies. The Companies
Act, 2013 has not recognised Accounting Standard-30, Accounting Standard-31 and Accounting
Standard-32. Also, these three accounting standards have been made recommendatory by the
Institute of Chartered Accountants of India and not mandatory.