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  • W.B.C.S. Main 2018 Question Answer – Commerce And Accountancy – Procedures For Issuing Accounting Standard.
    Posted on December 17th, 2018 in Commerce and Accountancy
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    W.B.C.S. Main 2018 Question Answer – Commerce And Accountancy – Procedures For Issuing Accounting Standard.

    WBCS  ২০১৮ মেইনস   প্রশ্নের উত্তর – বাণিজ্য এবং হিসাবরক্ষণ -অ্যাকাউন্টিং স্ট্যান্ডার্ড জারি করার পদ্ধতি.।

    1)What are the Procedures For Issuing Accounting Standard?

    Formation of the Accounting Standards Board

    The Institute of Chartered Accountants of India, recognizing the need to harmonies the diverse accounting policies and practices at present in use in India, constituted an Accounting Standards Board (ASB) on 21st April, 1977.Continue Reading W.B.C.S. Main 2018 Question Answer – Commerce And Accountancy – Procedures For Issuing Accounting Standard.

    Scope and Functions of Accounting Standards Board

    The main function of ASB is to formulate accounting standards so that such standards may be established by the Council of the Institute in India. While formulating the accounting standards, ASB will take into consideration the applicable laws, customs, usages and business environment.

    The Institute is one of the Members of the International Accounting Standards Committee (IASC) and has agreed to support the objectives of IASC. While formulating the Accounting Standards, ASB will give due consideration to International Accounting Standards, issued by IASC and try to integrate them, to the extent possible, in the light of the conditions and practices prevailing in India.

    Procedure for Issuing Accounting Standards

    Broadly, the following procedure will be adopted for formulating Accounting Standards

    ASB shall determine the broad areas in which Accounting Standards need to be formulated and ‘priority in regard to the selection thereof.

    In the preparation of Accounting Standards, ASB will be assisted by Study Groups constituted to consider specific subjects. In the formation of Study Groups, provision will be made for wide participation by the members of the institute and others.

    ASB will also hold a dialogue with the representatives of the Government, Public Sector Undertakings. Industry and other Organisations for ascertaining their views.

    On the basis of the work of the Study Groups and the dialogue with the organisation, an exposure draft of the proposed standard will be prepared and issued for comments by members of the Institute and the public at large.

    The draft of the proposed standard will include the following basic points

    A Statement of concepts and fundamental accounting principles relating to the Standard.

    Definitions of the terms used in the Standard.

    The manner in which the accounting principles have been applied for.

    The presentation and disclosure requirements in complying with the Standard.

    Class of enterprises to which the Standard will apply.

    Date from which the Standard will be effective.

    After taking into consideration the comments received, the draft of the proposed Standard will be finalized by ASB and submitted to the Council of the Institute.

    The Council of the Institute will consider the final draft of the proposed Standard, and it found necessary, modify the same in consultation with ASB. The Accounting Standard on the relevant subject will then be issued under the authority of the Council.

    Compliance with the Accounting Standards

    While discharging their attest functions, it will be duty of the members of the Institute to ensure that the Accounting Standards are implemented in the presentation of financial statements covered by their audit reports.

    In the event of any deviation from the Standards, it will also be their duty to make adequate disclosures in their reports so that the users of such statements may be aware of such deviations.

    In the initial years, the Standards will be recommendatory in character and the Institute will give wide publicity among the users and educate members about the utility of Accounting Standards and the need for compliance with the above disclosure requirements. Once an awareness about these requirements Is ensured, steps will be taken, in course of time, to enforce compliance with the accounting standards.

    The adoption of Accounting Standards in our country and disclosure of the extent to which they have not been observed will, over the years, have an important effect, with consequential improvement in the quality of presentation of financial statements.

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