ABOUT THE ACCOUNTING STANDARDS BOARD

The Accounting Standards Board (ASB) was constituted by the Institute in April, 1977
with a view to harmonise the diverse accounting policies and practices in India. The main
function of the ASB is to formulate Accounting Standards. While formulating the
Accounting Standards, ASB gives due consideration to the International Accounting
Standards issued by the International Accounting Standards Committee and tries to
integrate them, to the extent possible, in the light of applicable laws, customs, usages and
business environment prevailing in India. ASB also issues Guidance Notes on the
Accounting Standards and gives clarifications on issues arising therefrom.

Procedure for Issuing Accounting Standards

Broadly, the procedure for formulating and issuing accounting standards is as follows:-

i. ASB determines broad areas in which Accounting Standards need to be

formulated.
ii. In the preparation of Accounting Standards, ASB is asisted by Study Groups,
constituted by the members of the Institute, for considering specific subjects.
iii. ASB also holds a dialogue with the representatives of the Government, Public
Sector Undertakings, Industry and other organisations for ascertaining their
views.
iv. On the basis of the work of the Study Group and the dialogues with the
organisations referred above, an exposure draft of the proposed Standard is
prepared and issued for comments of the members and public at large.
v. ASB finalises the draft of the proposed Standard, on the basis of comments so
received and submits the same to the Council of the Institute.
vi. The Council considers the final draft of the proposed Standard and, if necessary,
modifies the same in consultation with the ASB. Thereafter, the Accounting
Standard is issued under the authority of the Council.