Accounting rules are really important. They enable companies to prepare, share and understand financial reports in the same way. The list of accounting standards stipulates exact procedures for the recording, presentation and disclosures of accounting information. Whether you are a student, accountant or business owner, having more knowledge about the accounting standards list is also a must. In India, accounting standards provide for truth and fairness and comparability and understandability of financial statements. Here in this article, we’re going to discuss the accounting standards list and what they are and how they are used.
What are the Accounting Standards?
Standards are written rules. They describe how businesses should account for and report their financial transactions. Such rules serve to ensure that everyone uses the same procedures. This allows people who read the reports to easily compare and trust them.
Purpose of Accounting Standards
Accounting standards are important as :
- Maintaining clear and honest records.
- Restoring faith among investors and banks in company reports.
- To make it easy to compare the reports of one company to those of another.
- Helping companies provide accurate information on their business activities.
And the use of accounting standards lists helps businesses to prevent errors and misunderstandings. It also serves shareholders and the public interest.
Indian Accounting Standards List
India has its own accounting standards. They are known as Indian Accounting Standards (Ind AS). They are formulated and revised by the Institute of Chartered Accountants of India (ICAI). The list of Indian accounting standards for companies is aimed at ensuring that companies in India follow the common global practices. These standards are crucial not just for public companies, but private companies and even sometimes small businesses.
Salient Features of Indian Accounting Standards
- Indian GAAP is influenced by IFRS.
- They assist Indian companies in compiling their financial statements for global presentation.
- They further ensure stability, transparency, and certainty.
A large private company or a company listed in stock exchange, also needs to comply with the minimum requirements of Indian accounting standards list.
Accounting Standards List with Examples
It is easier to learn the accounting standards list with examples. With the knowledge of the accounting standards list with examples, students and professionals can readily implement these principles in practice. Below is a reference table representing some of the major standards with sample data:
| Accounting Standard | Title | Example |
| AS 1 | Disclosure of Accounting Policies | Mention policies like revenue recognition in financial statements. |
| AS 2 | Valuation of Inventories | Inventory should be valued at cost or net realizable value, whichever is lower. |
| AS 9 | Revenue Recognition | Recognize revenue when it is earned and not when received. |
| AS 10 | Property, Plant, and Equipment | Show land and machinery separately and depreciate them. |
Accounting Standards List
ICAI has come out with 32 standards so far. Some, such as AS 6 (Depreciation), have been converged with others. Here is the complete list of 32 accounting standards:
AS 1: Disclosure of Accounting Policies
AS 2: Stock Valuation
AS 3: Cash Flow Statements
AS 4: Events Occurring After Balance Sheet Date
AS 5: Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies
AS 7: Construction Contracts
AS 9: Revenue Recognition
AS 10: Property, Plant and Equipment
AS 11: The Effects of Changes in Foreign Exchange Rates
AS 12: Government Grants partial exemption from application of AS 12 Government Grants.
AS 13: Investments accounting standards
AS 14: Amalgamations
AS 15: Employee Benefits
AS 16: Borrowing Costs
AS 17: Segment Reporting
AS 18: Related Party Disclosures.
AS 19: Leases
AS 20: Earnings Per Share
AS 21: (Revised) Consolidated Financial Statements
AS 22: Taxes on Income
AS 23: Investment in Associates
AS 24: Presentation of Discontinued Operations
AS 25: Financial Reporting For Interim Reporting Periods
AS 26: Intangible Assets
AS 27: Financial Reporting of Interests in Joint Ventures
AS 28: Impairment of Assets
AS 29: Provisions, contingent Liabilities and contingent Assets
How Many Accounting Standards?
Here is the answer to how many accounting standards there are –
- India first had 32 standards.
- Some have combined or dropped out after rewrites.
- Currently, under the Ind AS, 39 Indian Accounting Standards have been notified.
The list should not be comprehensive because there are active and applicability-bearing standards listed next to the year 2024.
Importance of Accounting Standards
Accounting standards are essential guidelines that ensure financial statements are consistent, comparable, and transparent. They help maintain trust among stakeholders, including investors, regulators, and the public, by ensuring accuracy and fairness in financial reporting.
Why Accounting Standards Matter?
Accounting standards are the backbone of sound financial management and responsible business conduct.
- Uniformity: They bring consistency in the way financial transactions are recorded across organizations.
- Comparability: They make it easier to compare financial data between companies and industries.
- Transparency: They ensure full disclosure of important financial information, reducing the chance of manipulation.
- Investor Confidence: Clear and honest financial reporting attracts investors and builds their trust.
- Legal Compliance: Following standards helps businesses stay aligned with government regulations and avoid penalties.
- Decision Making: Reliable financial data allows stakeholders to make informed business and investment decisions.
Relevance to ACCA Syllabus
It is tested in Financial Accounting (FA) and Management Accounting (MA) in ACCA. It explains the rudiments of financial disclosures, accounting principles, and internal financial systems to help students comprehend how these systems facilitate decision making.
Accounting Standards List ACCA Questions
Q1: What financial statement presents the financial position of a company on a particular date?
A. Income Statement
B. Statement of Changes
C. Statement of Cash Flows
D. Balance Sheet
Answer: D
Q2: What is the principle of double-entry?
A. Cash is recorded twice
B. Every charge is paired with a credit.
C. Double profits are counted
D. Assets equal liabilities
Answer: B
Q3: Which one of the following is not a tangible asset?
A. Inventory
B. Goodwill
C. Cash
D. Land
Answer: B
Q4: What is the role of depreciation in the context of accounting?
A. Increase asset value
B. Reduce liabilities
C. Allocate cost of asset over its life useful.
D. Match revenues to expenses
Answer: C
Q5: What principle precludes the financial statements from overstating income and must be used with prudence in preparing the financial statements?
A. Consistency
B. Going Concern
C. Prudence
D. Matching
Answer: C
Relevance to US CMA Syllabus
Financial Knowledge is important in Part 1: Financial Planning, Performance, and Analytics. Accountancy students for CMA should possess knowledge of financial statements, performance appraisal, cost management and control systems.
Accounting Standards List US CMA Questions
Q1: What is the best indicator of a company’s profitability?
A. Total Assets
B. Gross Margin
C. Net Income
D. Accounts Receivable
Answer: C
Q2: What is a characteristic of an income statement presented in common-size format?
A It is made up of the cash items alone.
B. Items presented as a percent of sales
C. It compares two companies
D. It ignores taxes
Answer: B
Q3: What is the costing (cost allocation) method for which overhead costs are assigned using activities?
A. Process Costing
B. Absorption Costing
C. Activity-Based Costing
D. Variable Costing
Answer: C
Q4: A budget that varies in proportion to the level of activity is called:
A. Static Budget
B. Flexible Budget
C. Capital Budget
D. Cash Budget
Answer: B
Q5: Which one of the below is NOT the component of working capital?
A. Buildings
B. Debentures
C. Inventory
D. Mortgage
Answer: C
Relevance to US CPA Syllabus
Instruction on Financial Knowledge is a subset of FAR. There is no escaping that CPA candidates need to know GAAP, revenue recognition, and financial statements and adjustments.
Accounting Standards List US CPA Questions
Q1: In the U.S., according to GAAP, the most important qualitative characteristic for useful financial information is:
A. Flexibility
B. Relevance
C. Personalization
D. Creativity
Answer: B
Q2: Which one of the following is a current liability?
A. Bonds payable in 10 years
B. Prepaid rent
C. Accounts payable
D. Treasury stock
Answer: C
Q3: What is demanded by the matching principle?
A. Recognizing revenues when cash is received.
B. Revenue is recognized when expenses are paid
C. Matching costs with the revenues they help produce
D. When to record an asset: when the asset is sold
Answer: C
Q4: Which of the following is not another comprehensive income (OCI)?
A. Change in unrealized appreciation (depreciation) of certain investments
B. Translation differences on foreign currency transactions
C. Revaluation of Land/property for GAAP
D., adjusting for pension liabilities
Answer: C
Q5: A trial balance is used to:
A. Calculate profit
B. Credits = Debits Both aspects keep in balance
C. Show asset values
D. Predict next year’s income
Answer: B
Relevance to CFA Syllabus
This is a major focus area for Level I. CFA candidates are required to analyze financial statements, interpret ratios, and reconcile accounting policies.
Accounting Standards List CFA Questions
Q1: What is the current ratio?
A. Profitability
B. Liquidity
C. Leverage
D. Market Value
Answer: B
Q2: Which of the following reflects the best measure of a company’s financial performance over time?
A. Balance Sheet
B. Income Statement
C. Notes to Accounts
D. Audit Report
Answer: B
Q3: A company using the FIFO method of inventory valuation during a period of inflation would report:
A. Higher cost of goods sold
B. Lower gross profit
C. Higher net income
D. More cash flow from operations
Answer: C
Q4: What is the ratio that measures how well interest can be covered with earnings?
A. Debt ratio
B. Return on equity
C. Interest coverage ratio
D. Dividend payout ratio
Answer: C
Q5: What is the method of measurement (model) for property, plant, and equipment under IFRS?
A. Only historical cost
B. Only fair value
C. Historical cost or revalued amount model
D. Net realizable value only
Answer: C
