M N H & Co.’s Post

The Corporate Affairs Ministry ( MCA ) has amended the Companies ( Indian Accounting Standards ) Rules, 2015, specifically targeting the insurance sector. As per the notification no. G.S.R. 492 (E) dated 12th August 2024, the Indian Accounting Standard ( Ind AS ) 117 has been introduced, with a complete focus on the nuances of insurance contracts. IND AS 17 is applicable for all insurance contracts other than below items - - warranties provided by a manufacturer, dealer or retailer in connection with the sale of its goods or services to a customer - employers’ assets and liabilities from employee benefit plans and retirement benefit obligations reported by defined benefit retirement plans. - contractual rights or contractual obligations contingent on the future use of, or the right to use, a non-financial item ( for example, some licence fees, royalties, variable and other contingent lease payments and similar items - residual value guarantees provided by a manufacturer, dealer or retailer and a lessee’s residual value guarantees when they are embedded in a lease - financial guarantee contracts, unless the issuer has previously asserted explicitly that it regards such contracts as insurance contracts and has used accounting applicable to insurance contracts. The issuer shall choose to apply either Ind AS 117 or Ind AS 32, Financial Instruments: Presentation, Ind AS 107, Financial Instruments: Disclosures and Ind AS 109, Financial Instruments to such financial guarantee contracts. The issuer may make that choice contract by contract, but the choice for each contract is irrevocable. - contingent consideration payable or receivable in a business combination - insurance contracts in which the entity is the policyholder, unless those contracts are reinsurance contracts held - credit card contracts, or similar contracts that provide credit or payment arrangements, that meet the definition of an insurance contract if, and only if, the entity does not reflect an assessment of the insurance risk associated with an individual customer in setting the price of the contract with that customer Some key changes for non-insurance companies are - - Intra group financial guarantee contracts - Financial guarantee contracts Ahuja Valecha & Associates LLP AVA Network AVA Insights Lalit Valecha Deepak Ahuja Rajiv Batra Prithvesh D. Ashar Mahesh Jeswani Vishal Solanki Ajay Kering Ankush Agrawal Mayur Zala Supriya Bansal Paresh Sancheti CA Ankit Shah Mukesh Bajaj Praveen Kumar Ashissh Mehta #indas #CA #change #Financedirector #controller #ICAI #wirc