Companies Indian Accounting Standards Amendment Rules 2024

REGD. No. D. L.-33004/99 The Gazette of India EXTRAORDINARY PART II—Section 3—Sub-section (i) PUBLISHED BY AUTHORITY No. 453] NEW DELHI, MONDAY, AUGUST 12, 2024/ SHRAVANA 21, 1946 CG-DL-E-14082024-256357 MINISTRY OF CORPORATE AFFAIRS NOTIFICATION New Delhi, the 12th August, 2024 G.S.R. 492 (E).—In exercise of the powers conferred by section 133 read with section 469 of the Companies Act, 2013 (18 of 2013), the Central Government, in consultation with the National Financial Reporting Authority, hereby makes the following rules further to amend the Companies (Indian Accounting Standards) Rules, 2015, namely: — 1. (1) These rules may be called the Companies (Indian Accounting Standards) Amendment Rules, 2024. (2) They shall come into force on the date of their publication in the Official Gazette. 2. In the Companies (Indian Accounting Standards) Rules, 2015 (hereinafter referred to as the said rules), in the “Annexure”, under the heading “B. Indian Accounting Standards (Ind AS)”, — (A) in “Indian Accounting Standard (Ind AS) 101”, — (i) for paragraph 39AE, the following paragraph shall be substituted, namely: — “39AE Ind AS 117, Insurance Contracts, amended paragraphs B1 and D1, deleted the heading before paragraph D4 and paragraph D4, and after paragraph B12 added a heading and paragraph B13. An entity shall apply those amendments when it applies Ind AS 117.” (ii) in Appendix B, — (a) in paragraph B1, for item (h), the following item shall be substituted, namely: — “(h) insurance contracts (paragraph B13); and” (b) for paragraph B13, the following paragraph shall be substituted, namely: — “Insurance contracts B13 An entity shall apply the transition provisions in paragraphs C1–C24 and C28 in Appendix C of Ind AS 117 to contracts within the scope of Ind AS 117. The references in those paragraphs in Ind AS 117 to the transition date shall be read as the date of transition to Ind ASs.” (iii) in Appendix D, — (a) in paragraph D1, item (b) shall be omitted; (b) paragraph D4 along with its heading shall be omitted. (iv) in Appendix 1, — (a) for paragraph 12, following paragraph shall be substituted, namely: — “12. The following paragraph numbers appear as ‘deleted’ in IFRS 1. In order to maintain consistency with paragraph numbers of IFRS 1, the paragraph numbers are retained in Ind AS 101: (i) Paragraph 19 (ii) Paragraph D1(b) (iii) Paragraph D1(e) (iv) Paragraph D1(o) (v) Paragraph D4 (vi) Paragraphs D9A and D9C (vii)Paragraphs D10-11 (viii) Paragraph D24 (ix) Paragraph D31 (x) Paragraphs E3-E7” (b) for paragraph 14, the following paragraph shall be substituted, namely: — “14. Paragraphs 34 to 39W and 39Y to 39AB and 39AD of IFRS 1 have not been included in Ind AS 101 as these paragraphs relate to effective date and are not relevant in Indian context. However, in order to maintain consistency with paragraph numbers of IFRS 1, these paragraph numbers have been retained in Ind AS 101.” (c) paragraph 15 shall be omitted. (B) in “Indian Accounting Standard (Ind AS) 103”, — (i) for paragraph 17, the following paragraph shall be substituted, namely: — “17. This Ind AS provides an exception to the principle in paragraph 15: (a) classification of a lease contract in which the acquiree is the lessor as either an operating lease or a finance lease in accordance with Ind AS 116, Leases. (b) [Refer Appendix 1] The acquirer shall classify those contracts on the basis of the contractual terms and other factors at the inception of the contract (or, if the terms of the contract have been modified in a manner that would change its classification, at the date of that modification, which might be the acquisition date).” (ii) for paragraph 20, the following paragraph shall be substituted, namely: — “20. Paragraphs 24–31A specify the types of identifiable assets and liabilities that include items for which this Ind AS provides limited exceptions to the measurement principle.” (iii) in paragraph 21, for opening paragraph, the following paragraph shall be substituted, namely: — “21. This Ind AS provides limited exceptions to its recognition and measurement principles. Paragraphs 21A-31A specify both the particular items for which exceptions are provided and the nature of those exceptions. The acquirer shall account for those items by applying the requirements in paragraphs 21A-31A, which will result in some items being:” (iv) after paragraph 31, the following paragraph shall be inserted, namely: — “Insurance contracts 31A The acquirer shall measure a group of contracts within the scope of Ind AS 117, Insurance Contracts, acquired in a business combination, and any assets for insurance acquisition cash flows as defined in Ind AS 117, as a liability or asset in accordance with paragraphs 39 and B93–B95F of Ind AS 117, at the acquisition date.” (v) for paragraph 35, the following paragraph shall be substituted, namely: — “35. A bargain purchase might happen, for example, in a business combination that is a forced sale in which the seller is acting under compulsion. However, the recognition or measurement exceptions for particular items discussed in paragraphs 22-31A may also result in recognizing a gain (or change the amount of a recognised gain) on a bargain purchase.” (vi) for paragraph 64N, the following paragraph shall be substituted, namely: — “64N. Ind AS 117 amended paragraphs 17, 20, 21, 35 and B63, and after paragraph 31 added a heading and paragraph 31A. An entity shall apply the amendments to paragraph 17 to business combinations with an acquisition date after the date of initial application of Ind AS 117. An entity shall apply the other amendments when it applies Ind AS 117.” (vii) in Appendix B, in paragraph B63, for item (b), the following item shall be substituted, namely, — “(b) (Refer Appendix 1)” (viii) in Appendix 1, — (a) for paragraph 5, the following paragraph shall be substituted, namely: — “5. Paragraphs 64-64J and 64L of IFRS 3 related to effective date have not been included in Ind AS 103 as these are not relevant in Indian context. However, in order to maintain consistency with paragraph numbers of IFRS 3, these paragraph numbers are retained in Ind AS 103.” (b) for paragraph 6, the following paragraph shall be substituted, namely: — “6. The following paragraph numbers appear as ‘Deleted’ in IFRS 3. In order to maintain consistency with paragraph numbers of IFRS 3, the paragraph numbers is retained in Ind AS 103: (a) Paragraph 17(b) (b) Paragraph B10 (c) Paragraphs B28- B30 (d) Paragraph B32(a) (e) Paragraph B63(b)”. (C) “Indian Accounting Standard (Ind AS) 104” shall be omitted. (D) in “Indian Accounting Standard (Ind AS) 105”, — (i) in paragraph 5, for item (f), the following item shall be substituted, namely: — “(f) groups of contracts within the scope of Ind AS 117, Insurance Contracts.”; (ii) after paragraph 42, the following shall be inserted, namely: — “Transitional provisions 43 [Refer Appendix 1] Effective date 44-44L [Refer Appendix 1] 44M Ind AS 117 amended paragraph 5. An entity shall apply that amendment when it applies Ind AS 117.” (iii) in Appendix 1, — (a) for paragraph 1, the following paragraph shall be substituted, namely: — “1. Paragraph 43 related to transitional provision given in IFRS 5 has not been included in Ind AS 105 since all transitional provisions related to Ind ASs, wherever considered appropriate have been included in Ind AS 101, First-time Adoption of Indian Accounting Standards, corresponding to IFRS 1, First-time Adoption of International Financial Reporting Standards. However, in order to maintain consistency with paragraph numbers of IFRS 5, the paragraph number is retained in Ind AS 105.” (b) after paragraph 5, the following paragraph shall be inserted, namely: — “6. Paragraphs 44-44L of IFRS 5 related to effective date have not been included in Ind AS 105 as these are not relevant in Indian context. However, in order to maintain consistency with paragraph numbers of IFRS 5, these paragraph numbers are retained in Ind AS 105”. (E) in “Indian Accounting Standard (Ind AS) 107”, — (i) in paragraph 3, for item (d), the following item shall be substituted, namely: — “(d) insurance contracts as defined in Ind AS 117, Insurance Contracts or investment contracts with discretionary participation features within the scope of Ind AS 117. However, this Ind AS applies to: (i) derivatives that are embedded in contracts within the scope of Ind AS 117, if Ind AS 109 requires the entity to account for them separately. (ii) investment components that are separated from contracts within the scope of Ind AS 117, if Ind AS 117 requires such separation, unless the separated investment component is an investment contract with discretionary participation features. (iii) an issuer’s rights and obligations arising under insurance contracts that meet the definition of financial guarantee contracts, if the issuer applies Ind AS 109 in recognising and measuring the contracts. However, the issuer shall apply Ind AS 117 if the issuer elects, in accordance with paragraph 7(e) of Ind AS 117, to apply