Indian minister suggests IFRS adoption from 2013
Aug 10, 2012
In a speech given in New Delhi at a seminar organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM), the Indian Minister for Corporate Affairs and Power, Dr. M. Verappa Moily, has indicated that the implementation of Indian Accounting Standards that are compatible with International Financial Reporting Standards (IFRS) may occur by April 1, 2013.
In February 2011, the Indian Ministry of Corporate Affairs (MCA) issued 35 Indian Accounting Standards (Ind AS) that are converged with, but not identical to, International Financial Reporting Standards (IFRS). A that time, it was announced that a 'phased implementation' would only proceed once certain Indian tax and other issues were resolved.
The tax issues revolve around the Indian Direct Taxes Code (DTC), in relation to the use of accounting information in determining tax liabilities. There have no substantive developments on the DTC to date comprehensively addressing these issues and accordingly, no timetable for the implementation of Ind AS has been announced.
However, Dr Moily noted the following in his speech:
We have taken the initiative that irrespective of whenever the DTC comes we will take it up with the Ministry of Finance and we are determined to ensure that IFRS is implemented by April 1, 2013
The comments were made in the context of a discussion about "reforms in the processes of doing business in India [that] are vital to keep pace with changing times and global trends". Whilst the speech is not definitive, and India's IFRS implementation is subject to further due process, this development may indicate an increased likelihood of India eventually moving to IFRSs.
Click for press release (link to ASSOCHAM website).