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ICAI issues Advisory on Impact of Coronavirus on Financial Reporting and the Auditors Consideration

Financial Reporting - High-Level Independent Committee - COP Fees - Cash Flows - ICAI - Taxscan

The Institute of Chartered Accountants of India (ICAI) has issued an advisory today regarding the impact of coronavirus pandemic on Financial Reporting and the audit of financial statements for the period March 2020.

ICAI is concerned about the impact of Coronavirus disease (known as COVID-2019 or COVID-19) on the health of people worldwide as well as on the state of economy and commerce of the world in general and on India specifically,” the ICAI said in the advisory.

ICAI is guided by the assessments given by the Government and public health authorities, domestic and international. Latest media reports indicate the possible severe impact of this pandemic that the World Health Organization (WHO), has been closely monitoring and considering its global impact. On March 11, 2020, WHO has assessed its risk and characterized it as a global pandemic in view of the alarming levels of spread and severity, and of the alarming levels of infection.

“While we are empathetic to the global concerns of health and safety of people, there is also a need to advise the preparers of financial statements to ensure that the potential impact of COVID-19 is suitably considered in preparing and reporting their financial statements for the year ended March 31, 2020. Specific requirements of a few accounting standards that may need special attention are indicated in this Accounting Advisory. It may be noted that we are only drawing the attention of preparers to some of the important requirements of Indian Accounting Standards (Ind AS) and Accounting Standards (AS), and this is not meant to be exhaustive and may differ based on specific facts, circumstances and business of respective preparers,” it said.

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