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Applicability of Accounting standards – Complete Guide
Hello everyone….Here in this article I’m going to discuss a few lines about the applicability of accounting standards…
First of all we should know the classification of non corporate entities as decided by ICAI.
Non corporate entities which fall in any one of the following categories at the end of relevant accounting year are called as level-1 entities:
1.Entities whose equity or debt securities are listed or in the process of listing with any stock exchange whether in India or abroad.
2.Banks, financial institutions or entities carrying in insurance business
3.All commercial, industrial and business reporting entities whose turnover is greater than 50 crores in the immediately preceding accounting period. Here other income is to be ignored in calculation of turnover.
4.All commercial, industrial and business reporting entities whose borrowings including public deposits in excess of 10 crores at any time during the immediately preceding accounting year.
5.Subsidiary or holding entities of any of the above.
Non corporate entities which are not covered in any of the above categories and fall any one of the following categories are level-2 entities.
1.All industrial, commercial and business reporting entities whose turnover exceeds rupees 10 crores but doesn’t exceed rupees 50 crores in the immediately preceding accounting year.
2.All commercial, industrial and business reporting entities whose borrowings including public deposits are above 1 crore but doesn’t exceed 10 crores at any time during the immediately preceding accounting year.
3.Holding and subsidiary entities of any one of the above.
Non corporate entities which are not covered under level-1 and level-2 are considered as level-3 entities.
Applicability of AS:
|AS-8||Not in existence|
|AS-20||Level-1, All companies|
|AS-24||Level-1&2/ All companies|
|AS-25||Level-1 and any entity which is required to prepare interim financial report|
#….As-21,23 & 27 are mandatory to those entities which require to prepare & present consolidated financial statements.
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