18. "RBI paves the way for equitable distribution of credit." Do you agree with the statement
Answers
Answer:
Explanation:
Introduction and Approach
1.1 India embarked on its journey of convergence to International Financial Reporting Standards (IFRS) in 2006 with the Institute of Chartered Accountants of India (ICAI) setting up a Task Force to consider the adoption of IFRS. In 2007, this Task Force published a comprehensive Concept Paper that recommended a convergence strategy rather than full fledged adoption, taking into consideration legal, regulatory and conceptual differences as well as existing business practices in India. The ICAI suggested that IFRS converged accounting standards should be adopted for public interest entities such as listed entities, banks and insurance entities and large-sized entities from the accounting periods beginning on or after April 1, 2011.
1.2 The convergence process received a substantial fillip with India making a commitment to converge the national accounting standards with IFRS at the G20 summit in Pittsburgh in 2009. As part of this commitment, the Ministry of Corporate Affairs (MCA), Government of India (GoI), released a road map in January 2010 which entailed IFRS convergence in a phased manner commencing from April 1, 2011 onwards for corporates, with the banking industry converging later from April 1, 2013 onwards. The delayed migration to IFRS converged standards by the banking industry, was on account of the anticipated changes in the global standards for financial instruments by June 2011 as the International Accounting Standards Board (IASB) had embarked on a joint project with the Financial Accounting Standards Board (FASB) of the US to replace International Accounting Standard (IAS) 39: ‘Financial Instruments- Recognition and Measurement’ with IFRS 9 -Financial Instruments.
1.3 In order to facilitate a smooth convergence and address implementation issues for the Indian banking system, the Reserve Bank of India(RBI) set up a Working Group in July 2010, under the Chairmanship of Shri P R Ravi Mohan, the then Chief General Manager of erstwhile Department of Banking Operations and Development (DBOD), comprising professionals with experience in IFRS implementation, representatives from the Indian Banks’ Association (IBA) and ICAI as well as officers from various regulatory, supervisory and market departments of the RBI.