Tax Audit Alert: Mandatory Disclosure of Accounting Policies via Form 3CD and New ICDS Schedule in Tax Returns.

Taxpayers are required to disclose significant accounting policies and specific details as per Income Computation and Disclosure Standards (ICDS) in their tax audit report using Form 3CD. These disclosures are mandatory for those subject to a tax audit. For individuals not liable to a tax audit, separate disclosure requirements are not necessary. The net effect of ICDS application on income must be reported in the income return. The return forms, specifically Forms 3, 5, and 6, have been updated to include a new schedule for ICDS to ensure compliance with these standards.