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Issue no. 3 | October 2016

Issue no. 3 | October 2016

This month the Accounting and Auditing Update highlights new and emerging concepts in the field of accounting and auditing.


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This month the Accounting and Auditing Update highlights new and emerging concepts in the field of accounting and auditing.

In continuation with our Data and Analytics (D&A) series, this edition carries an article on D&A in audit.  With D&A, auditors can provide clients and audit committees with the ability to look back, forward and tap into in-depth analysis about audit, financial and operational aspects of an organisations.  Our article discusses potential benefits and key value additions when utilising D&A with the help of case studies.

Ind AS 109, Financial Instruments brings various new concepts and financial instruments accounting can be complex under new framework.  Companies in India have investments in mutual funds and application of Ind AS 109 on classification requirements of mutual fund investments is likely to have an impact on their accounting treatment in the financial statements.  Additionally, effective interest rate method is a new concept under Ind AS 109.  In this edition we have discussed these issues with the help of illustrative examples and detailed flowcharts.

We have analysed annual reports of companies that are part of the Nifty 50 index with regard to Internal Financial Controls (IFC) reporting on both directors’ responsibility statement and auditor’s report.  Our article provides a brief analysis on such annual reports and highlights key observations. We also highlight new developments in financial reporting and its likely impact on future focus of IFC.  With respect to revenue, which is an important performance metric for companies and Ind AS 18, Revenue introduces new concepts.  Our article focusses on the impact areas due to implementation of Ind AS 18 on food, drink and consumer goods sector. 

We also cast our lens on recent development in the Emerging forms of External Reporting (EER).  Recently, the Integrated Reporting Working Group (IRWG) published its discussion paper to provide credibility and trust in the EER e.g. integrated reports.  Our article summarises the challenges when carrying out assurance engagements on such EERs. 

Our publication also carries a regular synopsis of regulatory updates.

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