ACCOUNTING STANDARD 1
· Significant Accounting Policies followed in preparation and presentation of financial statements should form part thereof and be disclosed at one place in the financial statements.
· Any change in the accounting policies having a material effect in the current period or future periods should be disclosed. The amount by which any item in financial statements is affected by such change should be disclosed to the extent ascertainable. If the amount is not ascertainable the fact should be indicated.
· If fundamental assumptions (going concern, consistency and accrual) are not followed, fact to be disclosed.
· Major considerations governing selection and application of accounting policies are i) Prudence, ii) Substance over form and iii) Materiality.
· The ICAI has made an announcement that till the issuance of Accounting Standards on (i) Financial Instruments : Presentation, (ii) Financial Instruments : Disclosures and (iii) Financial Instruments : Recognition and Measurement, an enterprise should provide information regarding the extent of risks to which an enterprise is exposed and as a minimum, make following disclosures in its financial statements:
a. category-wise quantitative data about derivative instruments that are outstanding at the balance sheet date,
b. the purpose, viz. hedging or speculation, for which such derivative instruments have been acquired, and
c. the foreign currency exposures that are not hedged by a derivative instrument or otherwise.
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