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    Financial Accounting Digital Assignment 3

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    Jayagokul Saravanan
    The document discusses accounting standards issued by the Institute of Chartered Accountants of India. It states that 32 accounting standards have been issued so far to establish uniform standards for financial statements. Accounting Standard 6 applies to depreciation, and Accounting Standard 3 applies to statement of cash flows. AS 6 covers depreciation accounting for tangible assets, while AS 3 requires companies to present cash flows from operating, investing and financing activities in their cash flow statements.

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    Financial Accounting Digital Assignment 3

    Uploaded by

    Jayagokul Saravanan
    56 views5 pages
    The document discusses accounting standards issued by the Institute of Chartered Accountants of India. It states that 32 accounting standards have been issued so far to establish uniform standards for financial statements. Accounting Standard 6 applies to depreciation, and Accounting Standard 3 applies to statement of cash flows. AS 6 covers depreciation accounting for tangible assets, while AS 3 requires companies to present cash flows from operating, investing and financing activities in their cash flow statements.

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    The document discusses accounting standards issued by the Institute of Chartered Accountants of India. It states that 32 accounting standards have been issued so far to establish uniform standards for financial statements. Accounting Standard 6 applies to depreciation, and Accounting Standard 3 applies to statement of cash flows. AS 6 covers depreciation accounting for tangible assets, while AS 3 requires companies to present cash flows from operating, investing and financing activities in their cash flow statements.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    56 views5 pages

    Financial Accounting Digital Assignment 3

    Uploaded by

    Jayagokul Saravanan
    The document discusses accounting standards issued by the Institute of Chartered Accountants of India. It states that 32 accounting standards have been issued so far to establish uniform standards for financial statements. Accounting Standard 6 applies to depreciation, and Accounting Standard 3 applies to statement of cash flows. AS 6 covers depreciation accounting for tangible assets, while AS 3 requires companies to present cash flows from operating, investing and financing activities in their cash flow statements.

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    of 5

    FINANCIAL ACCOUNTING

    DIGITAL ASSIGNMENT 3
    1. How many Accounting standards have been issued so far by
    the Institute of Chartered Accountants of India? Which
    Accounting standards are applicable to depreciation and
    statement of cash flows?

    Accounting Standards are written policy documents issued by expert


    accounting body or by the government or other regulatory body covering
    the aspects of recognition, measurement, treatment, presentation, and
    disclosure of accounting transactions in financial statements.
    32 Accounting Standards have been issued/ amended by the
    Accounting Standards Board of ICAI from time to time, to establish
    uniform standards for preparation of financial statements, in accordance
    with generally accepted accounting practices (GAAP) in India and for
    better understanding of the users.

    Indian Accounting Standards


    AS 01 : Disclosure of Accounting Policies
    AS 02 : Valuation of Inventories
    AS 03 : Cash Flow Statements
    AS 04 : Contingencies and Events Occurring after the Balance Sheet Date
    AS 05 : Net Profit or Loss for the Period, Prior Period Items and Changes
    in Accounting Policies
    AS 06 : Depreciation Accounting
    AS 07 : Construction Contracts
    AS 08 : Accounting for Research and Development
    AS 09 : Revenue Recognition
    AS 10 : Property, Plant and Equipment
    AS 11 : The effects of changes in Foreign Exchange Rates
    AS 12 : Accounting for Government Grants
    AS 13 : Accounting for Investments
    AS 14 : Accounting for Amalgamations
    AS 15 : Employee benefits
    AS 16 : Borrowing Costs
    AS 17 : Segment Reporting
    AS 18 : Related Party Disclosures
    AS 19 : Leases
    AS 20 : Earnings Per Share
    AS 21 : Consolidated Financial Statements
    AS 22 : Accounting for Taxes on Income
    AS 23 : Accounting for Investments in Associates in Consolidated
    Financial Statements
    AS 24 : Discontinuing Operations
    AS 25 : Interim Financial Reporting
    AS 26 : Intangible Assets
    AS 27 : Financial Reporting of Interest in Joint Ventures
    AS 28 : Impairment of Assets
    AS 29 : Provisions Contingent Liabilities and Contingent Assets
    AS 30 : Financial Instruments : Recognition and Measurements
    AS 31 : Financial Instruments : Presentation
    AS 32 : Financial Instruments : Disclosures
    Accounting Standard applicable to Depreciation-

    AS 06 Depreciation Accounting.

     This Standard applies to all depreciable assets, except


    the following items to which special considerations apply:
    —

    (i) forests, plantations and similar regenerative natural resources;

    (ii) wasting assets including expenditure on the exploration


    for and extraction of minerals, oils, natural gas and similar non-
    regenerative resources;

    (iii) expenditure on research and development;


    (iv) goodwill;

    (v) live stock.

    This standard also does not apply to land unless it has a limited useful
    life for the enterprise.

     Different accounting policies for depreciation are adopted by


    different enterprises. Disclosure of accounting policies for
    depreciation followed by an enterprise is necessary to appreciate the
    view presented in the financial statements of the enterprise
    Accounting Standard applicable to Statement of Cash
    Flows –
    AS 03 Cash flow statement

     The applicability of AS 03 Cash flow statement has been defined


    under the Companies Act, 2013. As per the definition in the act, a
    financial statement includes the following:

    i. Balance sheet

    ii. Profit and loss account or Income and expenditure account

    iii. Cash flow statement

    iv. Statement of changes in equity

    v. Explanatory notes

    Thus, cash flow statements are to be prepared by all companies but


    the act also specifies a certain category of companies which
    are exempted from preparing the same. Such companies are One
    Person Company (OPC), Small Company and Dormant Company.
     AS 3 Cash Flow Statements states that cash flows should exclude
    the movements between items which forms part of cash or cash
    equivalents as these are part of an enterprise’s cash management
    rather than its operating, financing and investing activities.
     Presentation of Cash Flow

    A cash flow statement must depict the cash flows within the period
    classifying them as

    A. Operating activities

    B. Investing

    C. Financing activities

    Companies must prepare and present cash flows from operating,


    financing as well as investing activities in such manner that is apt to
    their business. Financing and investing transactions which don’t
    require cash or cash equivalents mustn’t be included in the cash flow
    statement. Those transactions must be presented elsewhere in
    financial statements in a way which gives relevant information about
    such financing and investing activities.

    NAME:S.JAYAGOKUL.

    REG NO: 19BCC0020.

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