ICAI Council approves new business financial format; optional adoption by FY28

The Institute of Chartered Accountants of India (ICAI) has approved a revised financial statement format for businesses, marking a significant step toward enhancing transparency and standardization in financial reporting. This decision was finalized during the ICAI Council’s meeting, where the new structure was greenlit to align more closely with global accounting standards. The updated format seeks to improve the clarity, comparability, and utility of financial information, enabling better decision-making for investors and regulators. Companies will now be required to adopt these guidelines, which emphasize detailed disclosures about transactions, corporate governance practices, and risk management frameworks. The changes aim to streamline reporting requirements while ensuring compliance with both national regulations and international norms such as IFRS (International Financial Reporting Standards). This initiative is part of ICAI’s broader effort to modernize India’s accounting ecosystem and foster greater trust among stakeholders. Businesses across sectors, including manufacturing, services, and technology, will need to transition to the new format in their upcoming financial cycles. The council has also proposed training programs for chartered accountants and corporate finance teams to facilitate a seamless implementation. Feedback from industry experts has been largely positive, with many acknowledging the move as a necessary upgrade to keep pace with evolving economic complexities. However, some smaller enterprises have expressed concerns about compliance costs, prompting ICAI to consider phased adoption timelines for micro and small businesses. The revised standards are expected to advance India’s integration into global financial markets by promoting uniformity and reducing discrepancies in financial disclosures. This development underscores ICAI’s commitment to upholding the highest levels of accountability and efficiency in financial reporting practices nationwide.