17.10.2016 Guidance Note on Audit of Consolidated Financial Statements (Revised 2016) issued by the Auditing and Assurance Standards Board – (17-10-2016)

1. The Council of the Institute of Chartered Accountants of India had issued Accounting Standard (AS) 21 ‘Consolidated Financial Statements’ which was subsequently notified as a part of the Companies (Accounting Standards) Rules, 2006 by the Ministry of Corporate Affairs and subsequently amended vide the Companies (Accounting Standards) Amendment Rules, 2016. Also Indian Accounting Standard (Ind AS) 110, ‘Consolidated Financial Statements’ has been issued as a part of the Companies (Indian Accounting Standards) Rules, 2015 by the Ministry of Corporate Affairs. AS 21 and Ind AS 110 lay down principles and procedures for preparation and presentation of consolidated financial statements under AS and Ind AS respectively’. In other words, whenever a parent decides to or is required to prepare and present consolidated financial statements, it should do so in accordance with the requirements of applicable Accounting Standards2 under the relevant financial reporting framework.

This Guidance Note does not provide guidance in relation to amalgamation/business combination.

2. Consolidated financial statements normally include consolidated balance sheet, consolidated statement of profit and loss, consolidated cash flow statement, a consolidated statement of change in equity (if applicable) and any explanatory notes annexed to, or forming part thereof. Consolidated financial statements are presented, to the extent possible, in the same format as adopted by the parent for its separate financial statements. The formats for preparation of balance sheet, statement of profit and loss and a statement of change in equity (if applicable) are prescribed under the Schedule Ill of the Companies Act, 2013.

3. An entity which prepares the consolidated financial statements, either under any law or regulation governing the entity or suo motu, might be required to or otherwise engage the auditor for conducting the audit of consolidated financial statements. However, a law or regulation governing the entity may require the consolidated financial statements to be audited by the statutory auditor of the entity. This Guidance Note provides guidance on the specific issues and audit procedures to be applied in an audit of consolidated financial statements. This Guidance Note can also be used while auditing consolidated financial statements prepared for special purpose, to the extent applicable.

4. This Guidance Note does not deal with accounting matters arising on consolidation of financial statements.

Download Guidance Note on Audit of Consolidated Financial Statements (Revised 2016)

18.08.2016 Exposure draft of Guidance note on Audit of Consolidated Financial Statements

The Auditing & Assurance Standards Board of ICAI has issued an Exposure draft on Guidance note on Audit of Consolidated Financial Statements for public comments. This Guidance Note provides guidance on the specific issues and audit procedures to be applied in an audit of consolidated financial statements.

This Guidance Note can also be used for consolidated financial statements prepared for special purpose, to the extent applicable such as Initial Public Offers. Comments can be submitted not later than 10 September 2016.

Download Exposure draft of Guidance note on Audit of Consolidated Financial Statements

GST Course Join

More Under CA, CS, CMA

Posted Under

Category : CA, CS, CMA (3827)
Type : Featured (4025) News (13807)
Tags : accounting standard (339) ICAI (2674)

One response to “Guidance note on Audit of Consolidated Financial Statements”

  1. C.A. JUGAL KISHORE AGARWAL says:

    I have purchased this Guidance Note recently,
    I should be provided the new addition free of cost.

Leave a Reply

Your email address will not be published. Required fields are marked *

Featured Posts