No case for delaying Companies Bill

Laws of work say that 90 per cent of a project takes 10 per cent of the time. The remaining 10 per cent takes 90 per cent of the timeIn the case of the Companies Bill — drafted in 2009, the remaining 10 per cent is taking forever.

It is reported that the Bill, conceived to cleanse and condense a complicated Companies Act, 1956, may not be tabled before Parliament this session. This is ironical considering the fact that close on the heels of announcing 35 Converged Indian Accounting Standards, a new Schedule VI has been drafted.

Revised Schedule VI

For a corporate entity, Schedule VI is the equivalent of the Accounting Constitution. Initial reports suggested that the revised Schedule would apply to all entities, but a detailed look at the Schedule seems to suggest that it could only apply to entities that need to follow the Converged Indian Accounting Standards.

This could immediately spring a question whether one could have two Schedules under the same Act. When one can have multiple accounting standards, why not two Schedules? The stand-out feature in the Revised Schedule is the requirement to segregate both assets and liabilities into Current and Non-Current- a requirement that IFRS swears by.

Business Line : OTHERS / ACCOUNTANCY : No case for delaying Companies Bill