MANAGEMENT

Detailed explanation-1: -ICDS VI deals with the treatment of transactions in foreign currencies and forward contracts involving foreign currencies and translating the financial statements of foreign operations.

Detailed explanation-2: -There is no threshold limit on the amount of turnover or taxable income for the applicability of ICDS. Thus, every assessee earning business income or residuary income shall be required to follow ICDS for the computation of income.

Detailed explanation-3: -Income Computation and Disclosure Standards (ICDS) are guidelines using which taxpayers and the Income Tax Department can calculate the taxable income obtained by an assessee in a financial year. The ICDS were framed by the Government of India with the objective of inculcating uniformity in accounting policies.

Detailed explanation-4: -ICDS I provides that any mark to market loss or expected loss should not be recognized unless ICDS provides for that. AS 1 considers ‘prudence’ as one of the factor to select or change the accounting policy, according to which profits should be recognized only when it is realized, whether in cash or not.