Indian Accounting Standards (Ind AS)

Indian Accounting Standards (Ind AS) Latest News

Recently, the Insurance Regulatory and Development Authority of India (IRDAI) has introduced Ind AS (Indian Accounting Standards) for the Insurance Sector.

About Indian Accounting Standards (Ind AS)

• Indian Accounting Standards (Ind AS) are a set of accounting principles notified by the Ministry of Corporate Affairs (MCA) in 2015.
• These standards are largely converged with International Financial Reporting Standards (IFRS), bringing Indian financial reporting closer to global practices.
• Focus:  Ind AS emphasizes a principle-based approach, focusing on fair value measurement, transparency, and enhanced disclosure.
• History
• Before the introduction of Indian Accounting Standards (Ind AS), India followed the Indian Generally Accepted Accounting Principles (IGAAP). Indian GAAP was primarily developed by:
  • The Institute of Chartered Accountants of India (ICAI)
  • Provisions under the Companies Act, 1956
  • Indian GAAP comprised 18 accounting standards issued by ICAI, focusing largely on historical cost accounting and legal compliance.

Key Facts about Insurance Regulatory and Development Authority of India

• It is a statutory body formed under the Insurance Regulatory and Development Authority Act, 1999 (IRDAI Act 1999), for the overall supervision and development of the insurance sector in India.
• It acts as an autonomous authority under the Ministry of Finance, Government of India.
• The main goals of IRDAI are:

• • To safeguard the interest of the policyholders by fair business conduct and settlement of claims within time.
  • To regulate the business of insurance with transparency, fairness, and honest practice.
  • Facilitating financial prudence of the insurers through solvency and stability checks of insurers.
  • To regulate premium charges and policy terms for preventing unscrupulous pricing and unaffordability.
  • It is responsible for registering and/or licensing insurance, reinsurance companies, and intermediaries according to the regulations. 
  • It sets the eligibility criteria, qualifications, and capital requirements for obtaining licenses in the insurance business.
• Head Office: Hyderabad
• Composition: It consists of a Chairman, five full-time members, and four part-time members, all appointed by the Government of India.

Source: TH

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