TMI Short Notes

ICDS I : Accounting Policies

1. Change in accounting policy - When is to be changed - What should be the basis for change in accounting policy

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2. Accrual of income - Scope of ICDS - If there is conflict between Section 5 and Section 145, which would prevail

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3. ICDS - Accrual basis of Accounting - Accrual of income versus Receipt of income

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4. Whether it is required to disclose a change in the accounting policies if it has no material effect for the current previous year.

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5. ICDS-I provides that an accounting policy shall not be changed without ’reasonable cause’. The term ’reasonable cause’ is not defined. What shall constitute ’reasonable cause’.

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6. Why does the marked to market loss or an expected loss shall not be recognised as per ICDS-I.

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7. When does an assessee is required to make disclosures of fundamental accounting assumptions as per ICDS-I.

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8. What is the scope of Going Concern as per ICDS I.

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9. ICDS-I requires disclosure of significant accounting policies and other ICDS requires specific disclosures. Where is the taxpayer required to make such disclosures specified in ICDS.

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10. As per ICDS-I the Marked to Market loss or an expected loss shall not he recognized unless the recognition is in accordance with the provisions of any other ICDS. Whether similar consideration applies to recognition of Marked to Market gain or expected incomes.

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11. Since ICDS is not applicable for the purposes of maintenance of books of account, then what is the purpose and ambit of ICDS I on Accounting Policies as accounting policies are applied for maintenance of books of accounts and preparing financial statements.

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