TaxTMI 
TaxTMI 
Companies (Indian Accounting Standards) Second Amendment Rules, 2025
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....udes the transitional provisions of IFRS 11 Joint Arrangements. Accordingly, paragraph D31 of IFRS 1 has not been included;"; (b) in paragraph 8, in sub-paragraph (c), for item (2), the following shall be substituted, namely:- "(2) Paragraph D9AA has been added to provide for transitional relief to first-time adopter lessor while applying Ind AS 116, Leases. D9AA provides an entity to use the transition date facts and circumstances for lease arrangements which includes both land and building elements to assess the classification of each element as finance or an operating lease at the transition date to Ind ASs."; (c) in paragraph 12, item (vii) shall be omitted; (B) in "Indian Accounting Standard (Ind AS) 107", - (i) after paragraph 44II, the following paragraph shall be inserted, namely:- "44JJ Supplier Finance Arrangements, which also amended Ind AS 7, amended paragraph B11F. An entity shall apply that amendment when it applies the amendments to Ind AS 7."; (ii) in Appendix B, in paragraph B11F, for items (h) and (i), the following items shall be substituted, namely:- "(h) has instruments that allow the entity to c....
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....nd figures "paragraphs 74 and 75", the words, figures and letter "paragraphs 72A-75" shall be substituted; (vi) after paragraph 72, the following heading and paragraphs shall be inserted, namely:- "Right to defer settlement for at least twelve months (paragraph 69(d)) 72A An entity's right to defer settlement of a liability for at least twelve months after the reporting period must have substance and, as illustrated in paragraphs 72B-73 and 75, must exist at the end of the reporting period. 72B An entity's right to defer settlement of a liability arising from a loan arrangement for at least twelve months after the reporting period may be subject to the entity complying with conditions specified in that loan arrangement (hereafter referred to as 'covenants'). For the purposes of applying paragraph 69(d), such covenants: (a) affect whether that right exists at the end of the reporting period-as illustrated in paragraphs 74-75-if an entity is required to comply with the covenant on or before the end of the reporting period. Such a covenant affects whether the right exists at the end of the reporting period even if compliance with the covena....
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.... are approved for issue. However, in either of those circumstances, the entity may need to disclose information about the timing of settlement to enable users of its financial statements to understand the impact of the liability on the entity's balance sheet (see paragraph 17(c))."; (x) after paragraph 76, the following heading and paragraphs shall be inserted, namely: - "Settlement (paragraphs 69(a), 69(c) and 69(d)) 76A For the purpose of classifying a liability as current or non-current, settlement refers to a transfer to the counterparty that results in the extinguishment of the liability. The transfer could be of: (a) cash or other economic resources-for example, goods or services; or (b) the entity's own equity instruments, unless paragraph 76B applies. 76B Terms of a liability that could, at the option of the counterparty, result in its settlement by the transfer of the entity's own equity instruments do not affect its classification as current or noncurrent if, applying Ind AS 32 Financial Instruments: Presentation, the entity classifies the option as an equity instrument, recognising it separately from the liability as ....
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....t does not have the right to defer its settlement for at least twelve months after that date. 75 However, an entity classifies the liability as non-current if the lender agreed by the end of the reporting period to provide a period of grace ending at least twelve months after the reporting period, within which the entity can rectify the breach and during which the lender cannot demand immediate repayment. 75A Classification of a liability is unaffected by the likelihood that the entity will exercise its right to defer settlement of the liability for at least twelve months after the reporting period. If a liability meets the criteria in paragraph 69 for classification as non-current, it is classified as non-current even if management intends or expects the entity to settle the liability within twelve months after the reporting period, or even if the entity settles the liability between the end of the reporting period and the date the financial statements are approved for issue. However, in either of those circumstances, the entity may need to disclose information about the timing of settlement to enable users of its financial statements to understand the impact of ....
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....nce arrangements (as described in paragraph 44G) that enables users of financial statements to assess the effects of those arrangements on the entity's liabilities and cash flows and on the entity's exposure to liquidity risk. 44G Supplier finance arrangements are characterised by one or more finance providers offering to pay amounts an entity owes its suppliers and the entity agreeing to pay according to the terms and conditions of the arrangements at the same date as, or a date later than, suppliers are paid. These arrangements provide the entity with extended payment terms, or the entity's suppliers with early payment terms, compared to the related invoice payment due date. Supplier finance arrangements are often referred to as supply chain finance, payables finance or reverse factoring arrangements. Arrangements that are solely credit enhancements for the entity (for example, financial guarantees including letters of credit used as guarantees) or instruments used by the entity to settle directly with a supplier the amounts owed (for example, credit cards) are not supplier finance arrangements. 44H To meet the objectives in paragraph 44F, an entity shall d....
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....as at the beginning of the annual reporting period in which the entity first applies those amendments. (c) the information otherwise required by paragraphs 44F-44H for any interim period presented within the annual reporting period in which the entity first applies those amendments."; (H) in "Indian Accounting Standard (Ind AS) 10", - (i) in paragraph 3, - "(a) in the closing paragraph, for the word "provision", the word "covenant" shall be substituted; (b) closing paragraph shall be omitted for annual reporting periods beginning on or after the 1st April 2026."; (ii) after paragraph 23C, the following paragraph shall be inserted namely: - "23CA Classification of Liabilities as Current or Non-current and Noncurrent Liabilities with Covenants (Amendments to Ind AS 1), amended paragraph 3 for annual accounting periods beginning on or after the 1^st April 2026."; (iii) In Appendix 1, in paragraph 2, for the word "provision", the word "covenant" shall be substituted.; (I) in "Indian Accounting Standard (Ind AS) 12", - (i) after paragraph 4, the following paragraph shall be inserted, namely: - "4A Thi....