05 February 2015
Speaking today at a conference organised jointly by the IFRS Foundation and KPMG in Mumbai, India, Hans Hoogervorst, Chairman of the International Accounting Standards Board (IASB), commented on the benefits of IFRS adoption to Indian companies and said that Ind AS should be seen as a stepping stone towards full IFRS adoption.
India´s Ministry of Corporate Affairs earlier this year released a time line for the adoption of Indian Accounting Standards (Ind AS). The announcement is a milestone in the process towards full IFRS adoption in India.
Hans Hoogervorst, Chairman of the IASB, commented:
"India´s recent decision to adopt Ind AS, which is close to IFRS, is a momentous step that demonstrates the country´s focus on raising standards and increasing the appeal of Indian companies to foreign investors."
Ind AS is based on IFRS but has some carve-outs. India has been clear about its direction of travel, however. In his first Union Budget speech, Indian Minister of Finance Arun Jaitley stated that there is an urgent need to converge the current Indian accounting standards with IFRS.
Mr Hoogervorst said:
"Ind AS should only be seen as a stepping stone towards full IFRS adoption. Otherwise, Indian companies risk incurring the full costs of making the transition to a new standard without getting the full benefit, such as better access to capital and at a lower cost. Only India can make the decision about full IFRS adoption."