Comparative Study of Accounting

Standards Issued by ICAI with

International Accounting Standards

A Project Submitted to the Partial completion

Of the Degree of
Master of Commerce (Advance Accountancy)

Submitted by,
SHAIKH SADIYA TAJ MOHD

Under the Guidance of

CMA Dr. KINNARRY THAKKAR Head

DEPARTMENT OF COMMERCE
UNIVERSITY OF MUMBAI
VIDYANAGARI, SANTACRUZ
MUMBAI – 400 098

DEC– 2021
2
 DECLARATION BY THE STUDENT

I, Mrs. Shaikh Sadiya Taj Mohd student of M. Com Part II, Roll no 20024, at the
Department of Commerce, University of Mumbai, hereby declare that the work
embodied in this project titled ―Comparative Study of Accounting Standards
Issued by ICAI with International Accounting Standards” is an original work
done by me under the guidance of Prof. Kinnarry Thakkar and has not been
published or submitted elsewhere for the requirement of a degree program. Any
literature date or work done by other and cited within this thesis has been given due
acknowledgement and listed in the reference section.

I, here by further declare that all information of this document has been obtained
and presented in accordance with rules and ethical conduct.

Signature of Student

Mrs. Shaikh Sadiya Taj Mohd

 DEPARTMENT OF,
UNIVERSITY OF MUMBAI,
VIDYANAGARI, KALINA
3

CERTIFICATE

This is to certify that Mrs. Shaikh Sadiya Taj Mohd has worked and duly
completed his project work for the degree of Master of Commerce under the
faculty of Commerce in the Subject Advanced Accountancy and his project is
titled,
―Comparative Study of Accounting Standards Issued by ICAI with
International Accounting Standards” under my supervision.

I further certify that the entire work has been done by the learner under my
guidance and that no part of it had been submitted previously for any other Degree
or Diploma of any University.

It is his own work and facts reported by his personal funding and investigation.

Date of Submission: - / /
Internal Examiner External Examiner
Prof. Kinnarry Thakkar
(Head of Department of Commerce

Acknowledgement

 Through this acknowledgment, I take the

opportunity to express my sincere thanks to
various teachers, friends for their guidance and
assistance through which this project work is
completed.

 At first I express my gratitude towards HOD,

Prof. Kinnarry Thakkar for working teaching
and guidance of this subject research
Methodology and Project Work and inspiring all
students in our class for this project work.
 I also express my sincere thanks to people who
helped me directly and indirectly for providing
guidance for this particular project work.

 I also thanks to my friends for making me aware

from time to time and guiding me for completing
this project in time.
Introduction:-
Accounting Standards establish rules relating to
recognition,measurement and disclosures thereby ensuring that
all enterprises that followthem are comparable and that their
financial statements are true, fair andtransparent. High-quality
accounting standards are a necessary and importantelement of a
sound capital market system. In public capital markets such
asthose in the United States. High-quality accounting standards
reduceuncertainty and increase overall efficiency and investor’s
confidence byrequiring that financial report provide decision
useful information that isrelevant, reliable, comparable and
transparent once confined by national borders transactions in
today’s capital market often are driven by a demandfor and
supply of capital that transcends national boundaries. With
theincrease in cross-border capital rising and investment
transactions comes anincreasing demand for a set of high-quality
international accountingstandards that could be used as a basis
for financial reporting worldwide.“Accounting Standards are
written policy documents issues by theexpert accounting body or
by government or other regulatory body coveringthe aspects of
recognition, measurement, presentation and disclosure of
accounting transactions in financial statement.”
What are Accounting Standards:-
Accounting Standards are the statements of code of
practice of there gulatory accounting bodies that are
to be observed in the preparation of financial
statements. In layman terms accounting standards are
sued by the expert’s institutes or other regulatory
bodies covering various aspects of measurement
treatment, presentation of accounting transactions.

Who issues Accounting Standards in India:-

The institute of chartered Accountants of India (ICAI)
reorganizingthe need to harmonies the diverse
accounting policies and practices at present in use in
India constituted accounting standard board (ASB) on
April21, 1977. The main role of ASB is to formulate
accounting standards from time to time .
About ICAI:-
The Institute of Chartered Accountants of India (ICAI) is a statutory body
established under the Chartered Accountants act 1949.(Act No.XXXXVIII
of 1949) for the regulation of the profession of CharteredAccountants in
India. During its 61 years of existence, ICAI has achievedrecognition as a
premier accounting body not only in the country but alsoglobally, for its
contribution in the fields of education, professionaldevelopment
maintenance of high accounting, auditing and ethicalstandards. ICAI now
is the second largest accounting body in the wholeworld.

Procedure of formulating Accounting Standards in

India:-
The institute of Chartered Accountant of India (ICAI) recognizing theneed
to harmonize the diverse accounting policies and practices, constitutedan
accounting standards boards (ASB) on April 21, 1977. The main factionof
ASB so that such standards may be mandated by the council of
ICAI.While formulating the standards in India, ASB will take into
considerationthe applicable laws custom usages and business
environment. ICAI is one of the members of International Accounting
Standards Committee (IASC) andhas agreed to support the objectives of
IASC. ASB will give dueconsideration to IAS and try to integrate them to
the extent possible in lightof the considerations and practices pre-vailing
in India.The accounting standards issued will apply to ‘General
PurposeFinancial Statement’ this would include balance-sheet, Profit &
Loss A/cand other statement and explanatory notes which form part
thereof issued for the use of shareholders or members, Creditors,
Employees and public atlarge. The Accounting Standards are intended to
apply only to items whichare material. The standards are generally
expected to apply prospectively unless otherwise stated.
Broadly the following procedure will be adopted
forformulating Accounting Standards:-

•ASB shall determine the board areas in which

accounting standardsneed to be formulated and the
priority in regards to the selectionthereof.
•In the preparation of the accounting standards ASB
will be assisted bystudy groups constituted to
consider specific subjects. In the formationof the
study groups provision will be made for wide
participation bythe members of ICAI and others.
•ASB will also hold a dialogue with the representative
of the government, Public sector, Industry and other
organizations for ascertaining their views.
•Based on the above an exposure draft of the
proposed standard will be prepared and issued for
comments by members of ICAI and the publicat
large.
•After taking into consideration the comments
received the exposuredraft will be finalized by the
ASB and submitted to the council of ICAI. The
council of ICAI will consider the final draft and if
found necessary modify the same in consultation
ASB.