The Accounting Standards Board (ASB) of the Institute of Chartered Accountants of India (ICAI) has released three Tentative Agenda Decisions (TADs) received from the IFRS Interpretations Committee (IFRIC). These decisions address interpretive issues under the newly issued IFRS 18, Presentation and Disclosure in Financial Statements, as well as IFRS 9, Financial Instruments, promoting consistency in accounting practice across India. The three topics under consultation are outlined below:
1. Updates to committee’s agenda decisions – IFRS 18
In June 2025 the IFRIC proposed amendments to nine existing agenda decisions by replacing references to IAS 1, Presentation of Financial Statements with those to IFRS 18 Presentation and Disclosure in Financial Statements. IFRS 18 which is effective for years beginning on or after 1 January 2027 introduces new presentation requirements such as mandatory subtotals like operating profit, guidance on management defined performance measures MPMs and updated aggregation and disaggregation principles. The draft shows tracked changes incorporating these elements notably for scenarios such as supply chain finance reverse factoring. Public views are invited on whether these revisions enhance clarity and alignment with the new presentation standard.
Click here to read updates to Committee’s agenda decisions for IFRS 18
2. Determining accounting transaction costs – IFRS 9
Another TAD deals with the treatment of transaction costs under IFRS 9 Financial Instruments, specifically whether costs incurred before entering into a contractual arrangement such as legal and advisory fees should be included in initial recognition. The proposal clarifies that such pre-contract costs can be incremental and suitably recognised as prepayments until contract finalisation, after which they are included in the effective interest rate EIR calculation. Having observed broad consensus in practice the IFRIC does not intend to pursue a full standard setting project but invites public comment on its interim conclusion.
Click here to read the Tentative Agenda Decision
3. Embedded prepayment option – IFRS 9
The third TAD clarifies the application of paragraph B4.3.5(e)(ii) of IFRS 9 dealing with embedded prepayment options in financial liabilities. The interpretive question is whether the phrase “the entity” refers to the lender or borrower in assessing lost interest and deciding whether to bifurcate the embedded option. The IFRIC found uniform practice treating “the entity” as the lender and confirmed that existing wording is sufficiently clear. The committee will not add a separate project but welcomes feedback on the clarity and consistency of this interpretation.
Click here to read the Tentative Agenda Decision
All three tentative agenda decisions are open for public comment. The deadline for submissions is August 25 2025. Comments can be submitted via the ICAI online portal email [email protected].
Click here to submit comments on the Agenda Decisions
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