Role of non banking financial companies in industrial development in ind with particular bankia
Answers
The non-banking finance companies are planning to meet the Reserve Bank of India on the issue of implementation of Indian Accounting Standards, popularly known as Ind AS.
RBI has deferred the implementation of Ind AS for banks by a year, while it is applicable for NBFCs from April 1, 2018. NBFCs will have to compute their first quarter result this month and it is expected to have an impact on capital due to enhanced provisioning.
Ind AS is a global accounting practice that NBFCs are mandated to adopt, which may lead to initial credit losses. The practice is on a par with the International Financial Reporting Standard (IFRS) 9. The provisioning requirements under IFRS 9 would be higher as NBFCs will have to provide for on expected losses rather than incurred losses.
According to the initial plan, ministry of corporate affairs was to implement Ind AS for banks, insurance companies and NBFCs from 1 April 2018 onwards. In April 2018, RBI deferred the implementation of Indian Accounting Standards by one year for banks. Now, 2019-20 would be the first year of Ind AS with 2018-19 as the comparative year for banks. Also, Ind AS implementation date has been deferred for insurance companies by two years.