Background

The MCA, through its notification dated 16 February 2015, 2015 issued 39 Indian Accounting Standards (Ind AS) which are converged with the International Financial Reporting Standards (IFRS). Amongst those notified by MCA is Ind AS 115, Revenue from Contracts with Customers, which is based on IFRS 15, Revenue from Contracts with Customers.

IFRS 15 was issued in May 2014 as a result of a joint project of the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB).  Post the issue of IFRS 15, IASB received many representation for the deferral of IFRS 15 and accordingly, on 22 July 2015, the IASB confirmed a one year deferral of the effective date of IFRS 15 to 2018.  

New development

The initial plan of the regulators in India such as MCA and the Institute of Chartered Accountants of India (ICAI) was to implement the new revenue standard ahead of global roll-out.  However, post the deferral of IFRS 15 to 2018, the ICAI in October 2015 proposed a deferral of Ind AS 115. This has been confirmed by MCA through its notification issued on 30 March 2016. Consequently, MCA has issued the following Ind AS:

• Ind AS 11, Constructions Contracts along with the appendices corresponding to IFRIC 12, Service Concession Arrangements, SIC- 29, Service Concession Arrangements: Disclosures (collectively called ‘Ind AS on construction contract’)
• Ind AS 18, Revenue, along with the appendices corresponding to IFRIC 13, Customer Loyalty Programmes, IFRIC 18, Transfers of Assets from Customers, SIC-31, Revenue- Barter Transactions Involving Advertising Services (collectively called ‘Ind AS on revenue’)
• and Consequential amendments.

 This issue of IFRS Note provides an overview of these amendments.

 To access the text of MCA notification, please click here.