Roadmap for IFRS conversion

Roadmap for IFRS conversion

The roadmap requires a phased approach for IFRS adoption. The three phases are outlined as follows:

Phase	Date	Coverage
Phase 1	Opening balance sheet as of 1 April 2011*	1. Companies that are part of NSE 50 (Nifty 50) 2. Companies that are part of BSE Sensex (BSE 50) 3. Companies whose shares or other securities are listed on a stock exchange outside India 4. Companies, listed or not, having net worth exceeding INR1,000 crore
Phase 2	Opening balance sheet as of 1 April 2013*	Companies not listed in phase 1 and having net worth exceeding INR 500 crore
Phase 3	Opening balance sheet as of 1 April 2014*	Listed companies not covered in the earlier phases
*If the financial year of a company commences at a date other than 1 April, then it shall prepare its opening balance sheet at the commencement of the immediately following fiscal year.

IFRS roadmap overview

The MCA roadmap has provided specific dates for adoption of IFRS in India on the basis of a company’s net worth as indicated by the exchange on which they are traded. The IFRS conversion roadmap for Banks and Insurance companies will follow separately.

• Phase 1 companies are required to start reporting IFRS results from the first quarter of year beginning 1 April, 2011. Also, depending on how a company elects to present comparative information in the first year, the actual date of transition could be as early as 1 April 2010.
• The core group and its sub-group 1, constituted by the MCA for IFRS convergence, shall determine IFRS conversion roadmap for banking and insurance companies separately by 28 February 2010.
• Non-listed companies with net worth of less than INR 500 crore and other small and medium-sized companies (SMCs) have been given an option to continue to either follow non converged standards (hereinafter referred to as “Indian GAAP”) or to adopt IFRS.
• The draft of the Companies (Amendments) Bill, proposing for changes to the Companies Act, 1956, will be prepared by February, 2010.
• The Institute of Chartered Accountants of India (ICAI) has submitted to the MCA revised Schedule VI to the Companies Act, 1956. The NACAS shall review the draft and submit a revised Schedule VI to the MCA by 31 January 2010. Amendments to Schedule XIV will also be carried out in a time bound manner.
• Convergence of all the accounting standards with IFRS will be completed by the ICAI by 31 March 2010 and the NACAS will submit its final recommendations to MCA by 30 April 2010.