what is accounting standard
Answers
Answer:
An accounting standard is a common set of principles, standards and procedures that define the basis of financial accounting policies and practices. ... In the United States, the Generally Accepted Accounting Principles form the set of accounting standards widely accepted for preparing financial statements.
Explanation:
Meaning of Accounting Standards
Accounting Standards are written policy documents issued by expert accounting body or by the government or other regulatory body covering the aspects of recognition, measurement, treatment, presentation, and disclosure of accounting transactions in financial statements
Classification of Enterprises
The enterprises are classified and labeled as Level I, Level II and Level III companies. Based on this classification and the category in which they fall the Accounting standards are applicable to the enterprises
Level I Enterprises
Enterprises which fall under any one or more category below mentioned are termed as Level I Companies
Enterprises whose equity or debt securities are listed whether in India or outside India
Enterprises which are in the process of listing their equity or debt securities. Board of directors’ resolution must be available as an evidence
Banks including co-operative banks
Financial institutions
Enterprises carrying on insurance business
All commercial, industrial and business reporting enterprises, whose turnover not including ‘other income’ for the immediately preceding accounting period on the basis of audited financial statements exceeds Rs. 50 crore
All commercial, industrial and business reporting enterprises having borrowings, including public deposits, in excess of Rs. 10 crores at any time during the accounting period
Holding and subsidiary enterprises of any one of the above at any time during the accounting period