In the year 2006, ICAI commenced the process of shifting towards IFRS, considering India’s growing presence in global platform and consequent need to improve comparability and transparency of FS across borders.
Accordingly, Accounting Standards Board (ASB) of ICAI formulated the Ind AS in line with IFRS. In 2015,Ministry of Corporate affairs notified the Companies (Indian Accounting Standard) Rules 2015,which time lined the applicability of Ind AS.
As per the notification, Banks, insurance companies and NBFCs were supposed to implement Ind AS from 1 April 2018 onwards. But, RBI deferred the implementation by 1 year.
As per the notification, Banks, insurance companies and NBFCs were supposed to implement Ind AS from 1 April 2018 onwards. But, RBI deferred the implementation by 1 year.
Subsequently in 2019, RBI issued a notification dtd 20.2.2023, that it has decided to defer the implementation of Ind AS till further notice, considering the pending necessary legislative amendments to the Banking Regulation Act, 1949 and the level of preparedness of many banks.
Given the background, Will banks be implementing Ind AS from 2024-25? That's a question that RBI needs to answer.
Related to this subject, extract from a recent interview (May 2024)given by MD of Canara Bank Mr. K. Satyanarayana Raju to Business World Newsportal, is quoted below for reader's reference:
"For the last two years, I believe that the regulator has been preparing the industry to move towards the IND AS and expected credit loss (ECL) provisioning. When we have to move towards IND AS, everyone knows that the provisioning norms will be stricter in the coming days; it is not a new concept nor a surprise. I see the regulator preparing the industry mentally, step by step. It is the right time because every bank is doing very well. Banks have ample scope in their margins to absorb any such little shocks or pressure on their margins".
Related to this subject, extract from a recent interview (May 2024)given by MD of Canara Bank Mr. K. Satyanarayana Raju to Business World Newsportal, is quoted below for reader's reference:
"For the last two years, I believe that the regulator has been preparing the industry to move towards the IND AS and expected credit loss (ECL) provisioning. When we have to move towards IND AS, everyone knows that the provisioning norms will be stricter in the coming days; it is not a new concept nor a surprise. I see the regulator preparing the industry mentally, step by step. It is the right time because every bank is doing very well. Banks have ample scope in their margins to absorb any such little shocks or pressure on their margins".