Category: Commerce Notes PPT

A Financial Market is a term meant for a Business setup where different types of bonds and securities trade are done at lower rates of transaction. It includes different kinds of Financial securities like bonds, shares, derivatives, and forex Markets, to name a few.

To ensure that a capitalist economy functions well, the Financial Market is very necessary as it helps in resource allocation and creates liquidity for Businesses. 

The Financial Market ensures that the flow of capital between investing and collecting parties is mobilized properly.

Understanding Financial Markets and Institutions

Financial Markets help in smooth functioning of economies by allocating resources while also creating liquidity for Business enterprises. Different types of Financial holdings can be traded in these Markets. A vital importance of Financial Markets is that it enforces informational transparency to set efficient and appropriate Market prices.

Notably, macroeconomic factors like tax and other aspects often influence the Market values of Financial holdings which are not indicative of their intrinsic value. There are various types of Financial Markets, the New York Stock Exchange is one of the biggest stock Markets on this globe and this Financial Market records trade worth trillions of dollars everyday.

As an institution, Financial Markets aid in the flow of investments and savings. In turn, this facilitates the growth of funds, which goes on to help in production of goods and services. Another significance of Financial Markets is that it contributes to the demands of receivers, investors and even that of a country’s economy.

Different institutions which offer Financial holdings like mutual funds, insurances, pension, etc. combined with that of Financial Markets which offer bonds and shares contribute to a nation’s economic growth.

Types of Financial Markets

• Stock Markets- In this kind of Market, an organization makes a listing of its shares which traders and investors buy and sell. Stock Marketing, through the usage of IPO(Initial Public Offering), allows companies to increase their capital.

• Over The Counter Markets- It is a kind of decentralized Market, without fixed geographical locations. Here, the trade is directly done between two parties instead of an agent/broker. Most stock trading is done through exchanges.

• Bond Markets- The kind of securities that allow investors to borrow money from the lender for a certain period of time, with a fixed interest rate is known as bonds. Bonds are issued to aid Financial projects by different state and central government bodies, municipal corporations, etc. Bonds are usually issued as bills and notes.

• Money Markets- This kind of Market trades in holdings with higher liquidities and is relatively safer. In addition, the interest return is also cheaper. The capacity of trading between organizations and traders is quite huge if viewed on the wholesale level.

• Derivative Markets- This is a kind of Market where a contract is signed between two or more parties depending upon the Financial securities or assets. The worth of the derivatives is derived from the primary source of security to which it is linked, thus making it “secondary security”.

• Forex Market- Foreign Exchange Market, also called the Forex Market, is the kind of Market that basically deals with currencies. As cash is the most liquid asset, Forex Market has the highest liquidity of all Markets around the globe. Banks, commercial organizations, and investment management firms comprise the majority of the Forex Market.

Functions of Financial Market

Financial Markets helps in mobilizing savings, determining and settling the prices of various securities, providing liquidity to assets, and easing access to all types of traders.

While studying the functions of Financial Markets, students must take note of these aspects discussed below.

• Mobilising Funds: Among the diverse types of functions served by Financial Markets, one of the most crucial functions is that of mobilisation of savings. Financial Markets also utilise this savings investing it for productive use, thereby contributing to capital and economic growth.

• Determination of Prices: Another vital function served by Financial Markets is that of pricing different securities. Essentially, demand and supply in Financial Markets along with its interaction between investors determine these pricing.

• Liquidity of Financial Holdings: Tradable assets must be provided with liquidity for its smooth functioning and flow. This is another role of the Financial Market which goes on to help in the functioning of a capitalist economy. It not only allows investors to easily sell their securities and assets, but also allows them to easily convert them into cash money.

• Ease of Access: Financial Markets also offer efficient trading since they bring traders to the same Market. As a result, relevant parties do not have to spend any resource, be it capital or time, to find interest buyers or sellers. Additionally, it also provides necessary information related to trading, which also reduces the effort that interested parties must put in to complete their trades.

Students must note, the importance of the Financial Market is undeniable in this global economy. However, these Markets do not necessarily need a physical location and trading can often be conducted online or via phone.

Classifications of Financial Markets

Students trying to learn “what are the different Financial Markets” must note these classifications described below. These classifications can be divided into two further sections, which are explained in detail.

1. By Nature of Claim

• Debt Market: These Markets offer debt instruments and fixed claims like bonds and debentures, etc. for trading. Traders can buy these Financial holdings at debt Markets  for a fixed return and an agreed-upon maturity period.

• Equity Market: These Markets are designed for residual claims. Investors can deal in equity Financial holdings in such Markets.

2. By maturity of claim

• Money Market: Certificates of deposits, treasury bills, etc. are available in these Markets for trading. These are usually short term Financial holdings, and can be traded online since these Markets usually do not exist physically.

• Capital Market: Among classification of Financial Markets, capital Markets are divided into primary and secondary Markets. Primary Markets allow newly listed companies to issue new securities, while also allowing listed companies to issue new shares.

3. By Timing of Delivery

• Cash Market: These Markets offer real time transactions which are immediately settled between different sellers and buyers.

• Futures Market: Among various types of Financial Markets and their functions, these Markets offer transactions where settlements and commodities are delivered in future dates.

4. By organizational Structure

• Exchange-Traded Market: These are centralised trading Markets which record immense trading on a daily basis. These have standard procedures which regulate their functioning while trading Financial holdings like shares.

• Over-the-Counter Market: These Markets have customised procedures and do not have any centralised organisation. Traders can trade without involving any broker in their transactions. Typically offering shares from small companies, investors can trade in these Markets online.

This topic discussed above is a vital part of standard 10 + 2 curriculum for commerce students, as are many other related topics. Students can now avail study material on all these relevant topics from for greater clarity and understanding. Additionally, students can also attend the live classes offered by to attend lectures and clear any doubt they might have regarding their syllabus.

Business Organisation is an entity that is formed for the purpose of carrying on the commercial enterprise of selling and buying. These organisations are based on the systems of law that governs contract and this exchange, property rights, and incorporation.

 

The Business Organisation system is concerned with the management and planning of different activities. This is an accumulation and coordination of the resources such as men, material, money, machine to produce the goods and services, the business organisation works to coordinate and control all these factors of production.

 

Meaning of Business Organisation

Business organisation is defined as an entity which is structured for the purpose of carrying on the commercial system of enterprise. The organisation is governed under principles and laws governing contract and exchange of goods and services.

 

Business enterprises generally take one of these three forms:  

• Proprietorship

• Partnership 

• LLP

 

Proprietorship

In the proprietorship form one person is responsible for the entire operation as his own personal property is entrusted in it. This is usually managed on a day-to-day basis. Majority of the businesses we see around us are of this category. 

 

Partnership

The second form is Partnership, this needs 2-50 members to pursue the business. Law and accounting firms, brokerage houses and other advertising agencies are of this form. The business id formed by the partners themselves, their share of profit varies with individual investment invested in the partnership.

 

Limited Liability Partnership

The third form, which is the LLP form, is a very popular form of business for its inherited advantages from the partnership and company form of business. The company is legally separated from the individuals who work here in this organisation. They might be the shareholders or the employees who come in legal contract and thus can be sued and be sued by the company. The big industries and commercial organisations are limited-liability companies. 

 

Choice of Forms of Business Organisation

The four-prior types of business organisation are:

1. Sole Proprietorship

2. Partnership

3. Corporation

4. Limited Liability Company

 

1. Sole Proprietorship

The simple and common type of business found is this form of business ownership. Sole Proprietorship is a business which is owned and managed by a single individual for his own benefit and gain. The existence of this business depends upon the single owner, the business’s success and profit depends upon the owner. The business comes to an end after the incapacity or death of the owner. All the assets and liability of the firm is the sole responsibility of the owner himself/herself. Even the capital is their personal investment. The profit gained by the owner is accounted to the owner’s account and so does any loss. It is the owner’s unlimited responsibility for every transaction. 

2. Partnership 

There are two types of partnership:

General Partnership and Limited Partnership. Normally, both the owners invest their money, property and workforce in this business. They both are liable for the business debts. Also, partnerships do not require a formal agreement to start their business. The business agreement can be verbal or even be implied between the two partners. While Limited Liability Partnership or LLP requires a formal agreement between the partners. They also are liable to certify with the state. 

3. Corporation

These are the separate entities from the individuals or the members working here and are considered as a legal person. The profits generated by a corporation are taxed under “personal income” of the company. The income distributed to the shareholders are the dividends or the profits that are taxed as the personal income of the owners. With certain advantages the corporate structure does face disadvantages as well. The corporate structure faces double taxation which is one of the complexities of tax structure in this form of business. 

4. Limited Liability Company (LLC)

LLC provides the owners with limited liability also providing some of the income advantages of a partnership. Precisely to point, the advantages of partnerships and corporations are mixed in an LLC. LLC is a very popular form for its advantages. 

Thus, all these were the forms of business organisations, from these an individual chooses one to suit his venture and interest.

History of Business Organisation

The Industrial Revolution laid the groundwork for today’s business structures. Manual labour was mainly displaced by machine-based labour during the Industrial Revolution. The industry grew up around factories where the major means of production were machines rather than people. Many people, craftsmen, and family groupings abandoned their homes, small enterprises, and farms in favour of industrial positions that paid for low-skilled labour. Organisations divided duties among workers and built lines of control to arrange employees and executives in order of authority as they became more focused on machines. 

 

The jobs of individual workers become more specialised and routine. Manufacturers realised that assigning staff to simple, machine-based jobs boosted a company’s efficiency and productivity. Workers were taught to be focused and to follow factory work procedures. Charles Babbage (1791–1871), an English mathematician and inventor, was similarly interested in the division of labour in manufacturing. In his analysis of factory organisation, management, planning, and labour, he used scientific and mathematical approaches. Babbage’s ideas were compiled into a theory of organisation and administration known as scientific management in the early twentieth century, which had a significant impact on how organisations operated. 

 

American engineer Frederick Taylor (1856–1915), who grouped the theory into five key components, further expanded the theories of scientific administration. The first principle advocated for a transfer of responsibility from the worker to the manager inside a commercial organisation. Managers, Taylor felt, were responsible for planning and designing all of the work, while workers were responsible for completing given duties. The second premise advocated for the use of scientific methods to increase the efficiency of commodities manufacturing. 

An accountant is a person who records the business and financial transactions on behalf of the organization, he also reports the performance of the company to the management, and issues the financial statement of the concern. Several examples of the types of transactions in which an accountant is involved are as follows:

• An accountant issues an invoice to a customer which involves the recording of sale and account receivable. 

• An Accountant also receives an invoice from a supplier, who is involved in the recording of an expense or asset or an account payable.  

• An accountant issues a salary or wage paid to an employee involving the recording of an expense and outflow of cash.  

• An accountant also reconciles the bank statement.  

The Records Produced by an Accountant

In addition to the work of transactions performed by the accountant, the recording is also produced by an accountant. Following are the types of recording that is being provided:

• The Financial statements are presented to the owners or the business operators of a business, as well as to the lenders and the creditors.

• Management reports are also issued to the management team. The reports are highly customized according to the needs of the entity, which may cover important business topics.

• The tax reports are also issued to several government entities. The reports are then provided in detail regarding the amounts that are paid for income taxes, property taxes, and other sales taxes. 

Process Creation by the Accountants  

An accountant is again involved in the creation of a number of processes within the business network, which typically include several controls to ensure that the assets are properly managed by them. Examples of such processes are:

• Shipments to the customers

• Receipts from the suppliers

• Cash receipts from the customers

Maintaining Books of Accounts 

The Books of accounts have to be maintained if the gross receipts are more than Rs. 1,50,000 in 3 preceding years says the tax law. This too applies to a newly set up profession whose gross receipts are expected to be more than Rs. 1,50,000.

All the below professions are required to maintain the books of accounts:

• Legal Firms

• Medical Institutes

• Engineering Fields

• Architectural Sectors

• Accountancy Department

• Technical Consultancy Services

• Interior decoration professions

• The authorized representative, who represents another person for a fee before a tribunal or for any authority constituted under any law

• Film artist 

• Company secretary

Primary Function of Accountant

Accountants in the growing business arena perform a wide variety of functions. The primary functions performed by them can be summed up in the following:

1. Maintaining the Books of Accounts

This is the primary function of an accountant, which is to perform the functions of accounting. The accountant is required to maintain a systematic record of all the financial transactions of the firm. 

2. Statutory Audit

The laws as operated by the company law require a few organizations to be compulsorily audited by an auditor. So, the limited companies, the co-operative societies, companies, or the firms who have exceeded a certain turnover limit need their accounts to be audited.

3. Internal Audit

Few organizations opt for internal auditing, which can be done by the accountants. 

4. Taxation

An accountant is also capable of handling the taxation matters for a firm or even for an individual.

5. Cost and Management Accountant

Cost and Management accountant does more than an ordinary accountant, he plays an overall advisory role in the cost department and the management of an organization. 

6. Financial Advice

Accountants who have widespread knowledge and experience in many fields of the industries can also provide insight with good financial advice which in turn will be beneficial for the company.

Throughout the history of human life, many revolutions have come to change and improve our quality of living. The dictionary meaning of green revolution is the use of methods and tools like fertilizers, pesticides, high-yielding varieties of crops in developing countries to dramatically increase the production of crops like rice, wheat, etc. Green revolution calls for the use of better management techniques as well.

In industrialized countries, the green revolution means a steep rise in environmental concerns.

Introduction of Green Revolution

The green revolution was started in many countries around the world between the 1950s till the late 1960s. Many research technology transfer initiatives occurred around the world, which were geared towards increasing agricultural production.

Norman Borlaug is called the father of the green revolution as he started the green revolution with his genetic testing. He created a hybrid wheat plant that could resist fungus and diseases along with a high yield.

The green revolution in India refers to a period (the mid-1960s) where the transition from traditional agriculture into an industrial system happened. The green revolution started in India with the introduction of many modern methods of farming like tractors, pesticides, fertilizers, irrigation facilities, and the use of HYV (high yielding variety) crops.

When did the Green Revolution Start in India?

The Green revolution started in India started with its introduction in Punjab in 1966. It was part of a development program that was issued by the government of India along with international donor agencies.

Who Introduced the Green Revolution in India?

As a part of the larger initiative by Norman Borlaug, M S Swaminathan founded the Green revolution in India. Mankombu Swaminathan (born on the 7th August 1925) is an Indian geneticist and the founder of the M S Swaminathan research foundation which aims at eradicating hunger and poverty from the world. M S Swaminathan was the one to introduce and develop high-yielding varieties of wheat in India.

History of Green Revolution in India

Ford foundation sponsored a team of experts that were invited by India in the latter half of the second five-year plan. This team was called to suggest means and ways for improving crop production. Based on the recommendations of this team, the government of India implemented an intensive program for agricultural development in seven districts from seven different states of India in 1960. This program was called IADP (Intensive area development program).

In the mid-1960s Professor Norman Borlaug of Mexico developed new varieties of high-yielding wheat. India adopted this new agricultural strategy in 1966 during the Kharif season, and it was termed as HYVP (High-yielding varieties program). This program started as a package as it depended heavily on many things like:

Beneficial Impact of Green Revolution in India

India’s economy and way of life changed in a big way due to the Green revolution. One can gauge the major changes from the points outlined below:

The wheat crops got maximum benefit from the green revolution in India. Between 1967-68 the production of wheat crops grew more than three times. There was also an overall increase in agricultural produce, especially food grains. The green revolution was then aimed at the grain revolution after 1967. The overall increase in cereal production was doubled.

It brought prosperity to farmers as increased crop production gave them more earnings. Farmers with more than 10 hectares of land benefitted the most from the green revolution.

The humongous production of foodgrains in India helped in reducing the amount of food grains that were imported earlier. India became self-sufficient in food grains and was at times, also in a position to export the grains. In 1950 the per capita availability of food grains was only 395 grams per day which grew to 436 grams by 2003. The anxiety of food shortage took away the burden from planners so that they could concentrate on other Indian planning.

Since the green revolution involved a lot of machines, the demand for machinery like tractors, threshers, diesel engines, harvesters, pumping sets, combines, electric motors, etc. increased manifold. It also increased the need for pesticides, weedicides, fertilizers, insecticides, etc., which gave an industrial boom to various sectors. Many of the agricultural products were also being used as raw materials in many industries which were agro-based like textile, vanaspati, sugar, etc., which received benefits with the green revolution.

Though the green revolution brought a fear of unemployment since much of the human work was now being done by machines. There was a surge in demand for labour force due to the use of fertilizers and multiple cropping. As per reports, more than 15 lakhs poor people from states like Bihar, Orissa, and Uttar Pradesh found work in Punjab when the green revolutions started. Apart from earning, these poor people from different states also learned new techniques and ideas to take back home and implement.

Conclusion

The Green Revolution was a tremendous success for many developing countries, particularly India, providing them with unparalleled national food security.

It signified the successful adaptation and transfer of the same agricultural scientific revolution that the industrial countries had already appropriated.

However, factors other than guaranteeing food security, such as the environment, poor farmers, and their education about chemical know-how, received less attention.

As a way forward, authorities must more clearly target the poor to guarantee that new technologies help them more directly, and those technologies must also be more environmentally friendly.

Taking lessons from the past, such programs must also ensure that all beneficiaries are included, as well as all regions, rather than focusing on a narrow field.

Motivation is an action or word which influences others in terms of culture, work, behaviour, etc. Motivation is derived from the word motive, which means a need with required satisfaction. The role of motivation is very high in any organisation or workplace. Motivation can benefit in different ways. This motivation is of two types.

If the motivation has been done or happened by another person or a third party, it is known as extrinsic motivation. Because it happened with the help of outside forces. On the other hand, if the motivation is done from the inside of the mind or soul and one gets motivated by themselves, it is called intrinsic motivation. Let us discuss the importance of motivation, its significance, and its benefits to the employees and the organisation in detail.

Motivation and its Importance 

The Significance of motivation can’t be explained in a page or more because it changes the complete environment of the organisation. For instance, if a small kid was afraid to write 10 tables as homework, the mother tries to motivate the kid that he is strong enough to write, etc. In the same way, motivation plays a vital role in the organisation.

The importance of employee motivation may benefit the organisation in many ways. Let see some of the advantages of employee motivation to the firm as given below- 

• Improves Performance Level:- The motivation provided in the organisation gives a special spirit and energy to work more. Also, they get satisfied with the proper appraisal of the work they have done. All these factors will improve the performance level of an employee.

• Reduction in Resistance to Change:- even though the monetary benefits are countable, if the company atmosphere and colleagues, recognition is encourageable and gets motivated, no employee wants to change the organisation. This leads to a reduction in resistance to change in the company.

• Healthy Corporate Image:- The importance of motivation can also be measured in terms of corporate image. If the motivation and inspiration provided in the organisation were proper personnel may create a healthy corporate image in the market.

• Productive Utility of Resources:- another outcome that explains the importance of motivation is the productive utilisation of resources. If the motivation is good in the organisational environment, the relationship will be smooth. Then everyone can share their strengths and weaknesses. This results in making use of all the resources optimally.

• Increased Efficiency and Output:- One of the best advantages of employee motivation to the firm is the increase in the level of efficiency and output. As the resources are utilised optimally, the output may get increased than before. As already all the employees are working in satisfying conditions, they put their maximum efforts to give maximum efficiency.

• Achievement of Goals:- All the advantages of employee motivation to the company are interrelated. If the efficiency and output were increased, this is what achieves the goal of an organisation. The primary purpose of each organisation is to provide an effective output that earns a high income in return.

• Development of Friendly Relationships:- The significance of motivation results in the development of friendly relations between the employees and a smooth rap between the superior and subordinates.

• Stability in WorkForce:- as the reduction in resistance to change occurs due to the role of motivation, and it maintains stability in the workforce. As the employees are loyal to the organization, they can produce continuous stable work.

• Combines Ability with Willingness:- Work or a task can be achieved in two ways. One is the ability, and the other one is the willingness to do. If both qualities were merged due to the importance of inspiration, the effectiveness of output would be infinite.

• Easier Selection:- the selection process also becomes easier with the help of the significance of importance.

• Development of Leaders:- If the management understands the importance of motivation in education, every employee can try to upgrade his qualification and skills which leads to the development of more and more leaders or high-level employees.

Besides these advantages of employee motivation to the organisation, the employees may also get several benefits along with the organisation. Let’s have a glance at them.

Maslow’s Hierarchy of Needs Theory

Human behaviour is goal-oriented and motivation causes this behaviour. Motivation helps a person to understand his needs and tackle his needs purposely. The need hierarchy model is the best way to understand human motivation factors and the influence of the same. 

Abraham Maslow had proposed the hierarchy of needs theory in 1943 based on an assumption that there is a hierarchy of five needs in human life. The urgency and importance may vary from person to person.

The needs are classified into five categories as per the theory in an order to understand their importance and relevance to humans. 

• Physiological Needs: The needs which are important for human survival and maintenance are called Physiological needs. They are considered basic needs or amenities such as shelter, food, clothes, water, air, etc. 

• Safety Needs: The needs which help a human feel protected and secured are called the safety needs of a human. These needs could be physical safety, emotional safety, environmental safety or even protection of life and family. 

• Social Needs: Humans are called Social animals as they need love and affection. There is always a need for care from family and friends. 

• Esteem Needs: There are two factors to esteem needs. Esteem needs could be internal or external. Internal esteem needs confidence, freedom, self-respect, etc. External esteem needs attention, recognition, power, etc. 

• Self Actualization Needs: This need includes a certain urge to become what you think you have the potential to become. This need is directed more towards the growth and success of an individual. These types of needs are insatiable needs. The more knowledge a person gains the more he believes in his capabilities and in turn there would never be a feeling of saturation of these types of needs. 

As per the theory, Maslow believes that human needs are unsatisfactory but are the base of motivation for humans. He has bifurcated these above needs into two categories. The Higher-order needs and the lower-order needs. The Physiological and safety needs are lower-order needs as they can be satisfied externally. The other three needs are classified as higher-order needs – social, esteem and self-actualization as they can be only satisfied internally. As an organisation or an employer, it is important that the lower-order needs of the employees are satisfied to promote motivation. 

Implications of Maslow’s Hierarchy of Needs Theory 

• An employer needs to ensure the employees are paid enough to meet their physiological needs and should be allotted meal times at intervals.

• An employer needs to ensure the employees feel they are safe, secured and protected. For example, providing job security, insurance privileges, retirement benefits, etc.

• An employer needs to ensure the employees are promoted to work as a team and organise social events to give an opportunity to the employees to know the team on a social level as well. 

• An employer needs to ensure the employees are appreciated for their contribution and good performance should receive recognition. There could be an award ceremony held to appreciate and recognize the efforts of the employees. A promotion or growth opportunities should be considered as well.

• An employer needs to ensure the employees are given opportunities to upskill and move up the ladder in the organisation by accepting more responsibilities.

Limitations of Maslow’s Hierarchy of Needs Theory

• The theory is based on an assumption that the needs of all individuals are the same and that the motivation driving factors would be the same as well in every individual. An individual is always driven by the most important and powerful unsatisfied need, which could be different for every individual.

• The theory is not empirically supported, we cannot apply the same theory for every employee in an organisation. 

• The theory is not applicable to all professions or professionals. Even if an artist’s physiological needs are not met the artist would still strive for recognition. 

Benefits of Motivated Employees 

Inspiration is a single word that has a lot in it. The importance of inspiration can be understood only with experiences only. It can’t be explained in a few lines. Along with the organisation, their employees will also get several benefits with motivation. They are, 

• Reduction of Employee Turnover and Absenteeism 

• Better Industrial Relations

• Indifferent Attitudes can be Changed

• Facilities change

• Job satisfaction is achieved.

• Comfortable working conditions

• Reduction of changing tendency.

• Gains qualitative experience. Etc.

Hence all these advantages explain the role of motivation in every organization.

Accounting is known as the art of recording the exchanges in a manner to assist the perusers with showing up at the decisions or reaching a financial decision about the entity. This becomes fundamental that it ought to be joined into some normalized rules which are for the most part known to account for approaches.

Indian Accounting Standard is the Accounting standard taken on by organizations in India and given under the oversight of the Accounting Standards Board which was composed as a body in the year 1977.

The concocting of these strategies permits different organizations to adjust their accounting standards to repair for their own benefit. Standards are acquainted with quenching all disarrays, and these should have been set by the perceived accounting bodies. This idea repaired the way for the development of Accounting Standards. The Accounting Standards in India are given by the Institute of Chartered Accountants of India (ICAI).

Objectives of the Indian Accounting System

There are many objectives of an Indian Accounting system. We will discuss each and every point under IAS and understand its importance.

• This way, the global scope of Indian companies is expanded and they have a wider

• platform to perform on.

• This way the Indian companies can imply their rates and demands according to the global rates.

• This way the company accounts and the annual financial statements are transparent.

• It is easy and can be understood by companies worldwide.

• It lets us have a single framework for a single accounting framework.

Indian Accounting System: Benefits

As we already know that without benefits, nobody will try to pursue an accounting system like this. There are many benefits gained while following the Indian Accounting System, let us discuss all of them in detail.

• International Base – This lets the business have an international base and platform for companies to perform.

• Harmonization – This lets the companies harmonize their rules.

• Compliance – Increase compliance in companies.

• Global Acceptance – Globally reaches other companies and benefits them. This also gives global or international recognition.

Indian Accounting Standards List

Indian Accounting Standards Applicability

The Indian Accounting Standards are followed by all the companies. They shall follow Ind AS either Voluntarily or Mandatorily. When a company follows the Indian AS, either mandatory or voluntarily, it cannot return to its old method of Accounting.

Mandatory Applicability

Companies with a Net worth of not less than 500 crores are required to follow Ind AS.

Mandatory Applicability from Accounting Period beginning on or after 1 April 2017

Indian Accounting Standards Summary

Every functioning body that operates, needs a defined guideline so as to maintain the procedure and the standards of the operations of its own business. The rules make the policies common for organizations that operate in similar fields.