Is it legally mandatory to follow AS for Non-corporate entities like Proprietors, firms, etc. (Other than Companies) like companies??
is there any legal consequences or punishments if they do not use AS issued by ICAI?
because in many cases they have their own set of accountings and policies.
Please kindly advise.
Read more at: http://www.caclubindia.com/forum/applicability-of-as-to-non-corporate-entities-374184.asp
Non-Corporate Entities Must Follow ICAI Accounting Standards; Non-Compliance May Lead to Legal Consequences. A query was raised regarding the legal requirement for non-corporate entities, such as proprietors and firms, to adhere to Accounting Standards (AS) issued by the Institute of Chartered Accountants of India (ICAI), similar to companies. The concern was whether there are legal consequences for not following these standards, as many non-corporate entities have their own accounting practices. The response indicated that accounting standards apply to both corporate and non-corporate entities, suggesting that non-compliance could potentially have legal implications. (AI Summary)
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