Ind AS v IFRS explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Indian Accounting Standards follow the IFRS Standards closely, with the standards numbered to match, but not word for word. A handful of provisions are deliberately different (carve-outs), one body of guidance is added (a carve-in), and many smaller changes remove options or adapt wording to Indian law. This guide lists them with the paragraph in the Ind AS text, the effect on the accounts and a one-line reason for each carve-out.
Ind AS has eight carve-out topics against IFRS: covenant breaches on long-term loans (Ind AS 1 and 10), test-run sales proceeds (Ind AS 16), uniform policies for associates (Ind AS 28), foreign currency convertible bonds (Ind AS 32), three transition reliefs (Ind AS 101) and bargain purchase gains (Ind AS 103). Appendix C of Ind AS 103 on common control combinations is an addition, not a carve-out. Other differences mostly remove IFRS options (for example, only the cost model for investment property). The three amendments that ICAI's difference paper listed as yet to be notified on 1 April 2025 have since been notified by G.S.R. 549(E) dated 13 August 2025, as the compendium text of each standard prints.
Ind AS as on 1 April 2025 (ICAI Compendium of Ind AS 2025-26, the standards notified under the Companies (Indian Accounting Standards) Rules, 2015). Amendments notified after 1 April 2025 are not reflected in this article and should be checked on mca.gov.in. The article also reflects G.S.R. 549(E) dated 13 August 2025 where it says so, as printed in the compendium text of Ind AS 1, 7, 10, 12 and 107. A group that reports under both frameworks needs a reconciliation schedule of exactly these points, which our virtual CFO services team can maintain alongside the year-end accounts.
How the standards map
The numbering follows IFRS: IAS 1 is Ind AS 1, IAS 2 is Ind AS 2, and so on; IFRS 1 to IFRS 17 become Ind AS 101 to Ind AS 117 (ICAI's comparison appendix). Four items have no Ind AS: IAS 26 (retirement benefit plans, not applicable to companies), the hedge-accounting part of IAS 39 (only IFRS 9 hedge accounting is permitted in India), IFRIC 2 (co-operative entities' shares) and SIC 7 (introduction of the euro). For Ind AS 117 and Ind AS 104, the footnotes in the texts say Ind AS 117 was notified by G.S.R. 492(E) of 12 August 2024, and that G.S.R. 602(E) of 28 September 2024 allows an insurer to follow Ind AS 104 for consolidation by its parent, investor or venturer until the insurance regulator notifies Ind AS 117.
IFRS amendments not yet notified as on 1 April 2025
As on 1 April 2025, ICAI's difference paper lists these amendments as yet to be notified:
- Classification of liabilities as current or non-current and non-current liabilities with covenants (amendments to Ind AS 1);
- International tax reform, Pillar Two model rules (amendments to Ind AS 12);
- Supplier finance arrangements (amendments to Ind AS 7 and Ind AS 107);
- some editorial corrections issued by the IASB.
That was the position on that date. The compendium text of each standard now prints the first three as notified by G.S.R. 549(E) dated 13 August 2025: Ind AS 1, paragraphs 72A, 72B, 75A and 76A to 76ZA, with the effective date in paragraph 139U; Ind AS 12, paragraphs 4A and 88A to 88D; and Ind AS 7, paragraphs 44F to 44H, with a related change in Ind AS 107. Anything notified later should be checked on mca.gov.in.
The carve-outs, one by one
| Standard and paragraph | IFRS position | Ind AS position | Effect on the accounts |
|---|---|---|---|
| Ind AS 1, paragraph 74; Ind AS 10, paragraph 3 | A loan whose condition is breached at the reporting date becomes current, even if the breach is cured later | Not classified as current if the lender agreed after the period end, before approval of the statements, not to demand payment; Ind AS 10 treats that waiver as an adjusting event | Debt can stay non-current |
| Ind AS 16, paragraph 17(e) | Sale proceeds of items made while preparing an asset for use go to profit or loss with their cost | Excess of net sale proceeds over testing cost is deducted from the asset's directly attributable cost | Lower asset cost instead of income |
| Ind AS 28, paragraph 35 | Uniform accounting policies for the investor and its associate | Same, "unless, in case of an associate, it is impracticable" | Associate's own policies may be kept in that case |
| Ind AS 32, paragraph 11(b)(ii) | A conversion option in a foreign currency convertible bond is a derivative liability at fair value | Equity instrument if it gives a fixed number of the entity's own shares and the exercise price is fixed in any currency | No fair value swings in profit or loss |
| Ind AS 101, paragraph D7AA | Deemed cost by retrospective Ind AS 16, fair value, or previous GAAP revaluation | Option to take previous GAAP carrying values of property, plant and equipment (also intangible assets and investment property) as deemed cost | Opening carrying amounts can be carried over |
| Ind AS 101, paragraph D13AA | No equivalent | Continue the previous GAAP policy for exchange differences on long-term foreign currency monetary items recognised before the first Ind AS period | Transition history only |
| Ind AS 101, paragraph D22 | IFRS 1 allows the IFRIC 12 transition rules | Same, plus continuing the earlier amortisation policy for toll-road intangible assets of service concessions; Ind AS 38, paragraph 7AA, scopes them out | Revenue-based amortisation continues for those existing assets |
| Ind AS 103, paragraphs 34, 36 and 36A | Bargain purchase gain in profit or loss | Gain in other comprehensive income, accumulated as capital reserve; if clear evidence for the reason is missing, directly in equity as capital reserve; Ind AS 28 has a similar rule | No income statement gain |
The covenant carve-out has an end date in the text. Paragraph 139U of Ind AS 1, substituted by G.S.R. 549(E) dated 13 August 2025, prints a replacement paragraph 74 for annual reporting periods beginning on or after 1 April 2026: the liability is classified as current even if the lender agreed, after the reporting period and before approval of the statements, not to demand payment. The closing part of paragraph 3 of Ind AS 10 is omitted from the same date.
The reasons ICAI gives, in one line each: covenant breaches are often procedural and cured quickly; test-run output is incidental to getting the asset ready; some associates cannot apply Ind AS; the option's value in a foreign currency convertible bond should not move with currency alone; old companies often cannot rebuild historical cost; earlier Indian practice allowed exchange differences on long-term foreign currency items to be capitalised or deferred; toll-road concessions were amortised on revenue earlier; and a bargain gain was treated as a capital reserve under earlier practice. Details of the measurement are in our guides to business combinations, equity or financial liability and first-time adoption.
The carve-in
IFRS 3 does not deal with business combinations under common control. Ind AS 103, Appendix C gives guidance for them, which is additional guidance not found in the IFRS Standards. Our guide to common control combinations explains it. Ind AS 111 also refers to Appendix C for a joint operation interest acquired within a common-control group.
Other differences that remove options or adapt wording
| Ind AS | Difference from IFRS | Paragraph |
|---|---|---|
| Ind AS 1 | Single statement of profit and loss with two sections; expenses analysed by nature only; one set of titles | 10A, 99 |
| Ind AS 7 | Interest paid is financing; interest and dividends received are investing; dividends paid are financing | 33-34 as discussed in the text |
| Ind AS 19 | Post-employment obligations discounted by reference to government bond yields | 83 |
| Ind AS 27 | Separate statements: cost or Ind AS 109 only, no equity method option | 10 |
| Ind AS 33 | Earnings per share in both consolidated and separate statements | 4 |
| Ind AS 40 | Cost model only; fair value model not permitted | 30 |
| Ind AS 109 | No option to keep IAS 39 hedge accounting | Chapter 6 |
| Ind AS 115 | Penalties follow the substance of the contract; excise duty shown separately; revenue reconciled to contract price | 51AA, 109AA, 126AA |
| Ind AS 116 | Fair value option for right-of-use assets deleted; interest on lease liability is financing | 34, 50(b) |
Many Ind AS transition and effective-date paragraphs of IFRS are omitted because the transition rules sit in Ind AS 101, and the IFRS applicability tests for listed entities are omitted because the Companies Act and its Rules decide who applies Ind AS. Terminology also follows Indian law: "balance sheet" and "statement of profit and loss". For the earlier Accounting Standards, see our Ind AS v AS comparison.
How a finance team uses the list
- Keep a one-page register of the differences that touch your accounts (for example, test-run proceeds and investment property).
- For each, record the Ind AS paragraph and the IFRS position, so a group reporter can reconcile quickly.
- Re-check mca.gov.in each year-end for notified amendments, starting with the items in Section I above.
- Read the standard's own comparison appendix before telling a lender or foreign parent that "Ind AS equals IFRS".
Need help reconciling Ind AS and IFRS?
If your group reports to a foreign parent or lender under IFRS, a reconciliation of the carve-outs above is usually the heart of the exercise. Our team prepares and updates it through our virtual CFO services, tied to the Ind AS paragraph for each line.
Key takeaways
- The carve-outs are few and each sits in a named paragraph; the rest are removed options and wording changes.
- Several carve-outs change presentation more than amounts: debt classification, test-run proceeds, bargain gains in reserve.
- Transition reliefs in Ind AS 101 matter only to companies adopting Ind AS for the first time.
- The Section I amendments were pending on 1 April 2025 and were notified by G.S.R. 549(E) dated 13 August 2025; the covenant carve-out in Ind AS 1 ends for annual reporting periods beginning on or after 1 April 2026. Check mca.gov.in for anything later.
- The concepts behind both sets of standards are in our Framework guide.
Read next
- Conceptual Framework for Financial Reporting under Ind AS
- Common control business combinations under Appendix C of Ind AS 103
- Equity or financial liability under Ind AS 32
- Ind AS v AS: key differences explained
Disclaimer: Based on the Indian Accounting Standards as on 1 April 2025 (ICAI Compendium of Ind AS 2025-26, the standards notified under the Companies (Indian Accounting Standards) Rules, 2015) and, where named, the ITFG clarification bulletins of ICAI, as consulted on 4 October 2026. Amendments notified after 1 April 2025 should be checked on mca.gov.in. This article is general information, not legal advice; check the official text before acting.