Relaxation on Applicability of Accounting Standard for SMC
What are the Relaxation on Applicability of Accounting Standard for SMCs : MCA Notification dated 23.06.2021
Applicability Different Accounting Standard on Small and Medium Sized Companies & Non- Small and Medium Sized Companies
| S. No | Accounting Standards (AS) | Small and Medium Sized Companies | Non- Small and Medium Sized Companies |
| 1 | Disclosures of Accounting Policies- Accounting Standard-1 | Applicable | Applicable |
| 2 | Valuation of Inventories- Accounting Standard-2 | Applicable | Applicable |
| 3 | Cash Flow Statements- Accounting Standard -3 | Applicable | Applicable |
| 4 | Accounting Standard-4 Contingencies and Events Occurring After the Balance Sheet Date | Applicable | Applicable |
| 5 | Accounting Standard-5 Net P/L for the Period, Prior Period Items and Changes in Accounting Policies | Applicable | Applicable |
| 7 | Accounting Standard-7 Construction Contracts | Applicable | Applicable |
| 9 | Accounting Standard-9 Revenue Recognition | Applicable | Applicable |
| 10 | Accounting Standard-10 Property, Plant and Equipment | Applicable | Applicable |
| 11 | Accounting Standard-11 The Effects of Changes in Foreign Exchange Rates | Applicable | Applicable |
| 12 | Accounting Standard-12 Accounting for Government Grants | Applicable | Applicable |
| 13 | Accounting Standard-13 Accounting for Investments | Applicable | Applicable |
| 15 | Accounting Standard-14 Accounting for Amalgamations | Applicable | Applicable |
| 16 | Accounting Standard-15 Employee Benefits | Applicable with Certain Exemptions# | Applicable |
| 17 | Accounting Standard-16 Borrowing Costs | Applicable | Applicable |
| 18 | Accounting Standard-17 Segment Reporting | Not Applicable# | Applicable |
| 19 | Accounting Standard-18 Related Party Disclosures | Applicable | Applicable |
| 20 | Accounting Standard -19 Leases | Applicable with Certain exemption# | Applicable |
| 21 | Accounting Standard-20 Earning Per Share | Applicable with Certain exemption# | Applicable |
| 22 | Accounting Standard-21 Consolidated Financial Statements | Applicable | Applicable |
| 23 | Accounting Standard-22 Accounting for Taxes on Income | Applicable | Applicable |
| 24 | Accounting Standard-23 Accounting for Investments in Associates in Consolidated Financial Statements | Applicable | Applicable |
| 25 | Accounting Standard-24 Discontinuing Operations | Applicable | Applicable |
| 26 | Accounting Standard-25 Interim Financial Reporting## | Applicable | Applicable |
| 27 | Accounting Standard-26 Intangible Assets | Applicable | Applicable |
| 28 | Accounting Standard-27 Financial Reporting of Interest in Joint Ventures | Applicable | Applicable |
| 29 | Accounting Standard-28 Impairment of Assets | Applicable with Certain exemption# | Applicable |
| 30 | Accounting Standard-29 Provisions, Contingent Liabilities and Contingent Assets | Applicable with Certain exemption# | Applicable |
What is the Relaxation on Applicability of Accounting Standard for SMCs?
Following basic Relaxations provided to the SMCs according to the MCA Notification dated 23 June 2021
- AS not now applicable to Small and Medium Sized Companies in their completely – AS 17, Segment Reporting.
- Accounting Standard’s in respect of which relaxations from certain requirements have been given to SMCs:
- Accounting Standard-19,- discloser related to the Paragraphs 22 (c),(e) and (f); 25 (a), (b) and (e); 37 (a) and (f); and 46 (b) and (d) relating to disclosures) Leases
- AS -29, Disclosure of related to the Paragraphs 66 & 67 relating to disclosures- Provisions, Contingent Liabilities & Contingent Assets
- Accounting Standard-20, specify the Disclosure of diluted EPS – Earning Per Share
- AS – 28, Small and Medium Sized Companies are now allowed to measure ‘value in use’ on the basis of reasonable estimate or apply according to the Accounting Standard 28- Impairment of Assets
- Accounting Standard -15, – discloser related to the Para 11 to 16 – related to short-term accumulating compensated absences which are non-vesting, Para 46 to 139 – which deal with discounting of amounts that fall due more than 12 months Para 50 to 116 and para 117 to 123 of the Standard in respect of accounting for defined benefit plans Para 129 to 131 of the Standard in respect of accounting for other long-term employee benefits- Employees Benefit
- AS -25, applicability related to Interim Financial Reporting, does not needed to give interim financial report related to the company. It is applicable only if a corporate is needed or elects to prepare & present an interim financial report.
Details about the notifications you may refer the below notification MCA Notification on AS
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