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XBRL goes Topsy Turvy – Unlisted Companies again in the ambit

MCA has issued General Circular 37 dated 7th June, 2011 on XBRL which supercedes its earlier two circulars on the subject.

The implication of the above circular no. 37 is that even unlisted companies having a paid-up capital of Rs. 5 crores or more OR a turnover of Rs. 100 crores or more come under the ambit of XBRL right from Phase 1 in this year itself. Even all listed Companies come under the ambit of XBRL as opposed to listed Companies above Rs. 5 crores capital or Rs. 100 crores turnover.

MCA in its first Circular had notified the above position only; however, later rectified the situation by issuing a Corrigendum taking Unlisted companies and small listed companies out of the purview of XBRL in Phase 1.

In this circular, MCA has again reverted back to its original position, which has huge repercussions for the Unlisted and the small listed Companies as they are nowhere near to readiness for XBRL. Forget readiness, even the concept is not clearly understood by a vast majority of Accounting & Finance Teams even in large Companies.

The least we expect is another Corrigendum now. Till that time, the uncertainties continue and CFOs are struggling with little clue as to how to fit their Balance Sheets into another set of over 3000 taxonomies without any clear direction and automation.

The note below provides the legalese of the above interpretation.

ORIGINAL CIRCULAR NO. 9/2011 DATED 31.03.2011

As per the Original General Circular no.9/2011 dated 31.03.2011 , the coverage in Phase I stated as follows:

The following class of  companies have to file the  Financial Statements in XBRL Form only from the year 2010-2011 :-

(i) All companies listed in India and their subsidiaries, including overseas subsidiaries;

(ii) All companies having a   paid up capital of Rs. 5 Crore and above or a Turnover of  Rs 100 crore or above .

CIRCULAR NO. 25/2011 DATED 12.05.2011 MODIFICATION TO ABOVE CIRCULAR

As per the Corrigendum issued vide General Circular Number 25/2011 dated 12.05.2011 the coverage in Phase I  was modified as follows:

Clauses (i) and (ii) of paragraph 2 under the Heading Coverage in Phase I, the following shall be substituted and read as:

(i) All companies listed in India and their subsidiaries, having paid up capital of Rs. 5 Crore and above or a turnover of Rs. 100 Crore or above, excluding banking companies, insurance companies, power companies. Non Banking Financial Companies (NBFCs) and overseas subsidiaries of these companies.

The implication of the above Corrigendum was that only listed Companies in India and their subsidiaries having paid up capital of Rs. 5 Crore and above or a turnover of Rs. 100 Crore or above, excluding banking companies, insurance companies, power companies. Non Banking Financial Companies (NBFCs) and overseas subsidiaries of these companies shall be covered under Phase 1. In the earlier circular, even unlisted Companies were covered under Phase 1.

CIRCULAR NO. 37/2011 DATED 07.06.2011 ISSUED IN SUPERSESSION TO THE ABOVE TWO CIRCULARS

Coverage in Phase I

The following class of companies have to file the Financial Statements in XBRL Form only from the year 2010-2011:-

i)          All companies listed in India and their Indian subsidiaries;

ii)         All companies having a paid up capital of Rs.5 crore and above

iii)         All companies having a turnover of Rs.100 crore and above.

However banking companies, insurance companies, power companies and Non Banking Financial Companies (NBFCs) are exempted for XBRL filing, till further orders.

Tags: Taxonomy for XBRL ReportingxbrlXBRL Reporting

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About Sumit Pahwa

Sumit Pahwa | Partner

A Corporate Lawyer & Company Secretary, Sumit has over 17 years of experience in dealing with the Corporate Legal and Compliance issues of small, medium and large corporates and is the founder partner of the law firm “eMinds Legal”, a Corporate Law Firm based in Gurgaon specialising in Corporate Secretarial, Corporate Legal and Compliances.

Sumit is an expert in Corporate Laws, Governance, Risk & Compliance and has independently led investigations related to Sexual Harassment, Fraud, Cybercrime and whistle blower cases.

Sumit is also the Lead Author of “Corporate Law Referencer” - a leading book on Companies Act, 2013 and LLP Regulations and published by Lexis Nexis.

Sumit is a regular speaker at the Institute of Company Secretaries of India, various management colleges and several small and large corporates on Corporate Laws, Sexual Harassment Laws and Compliances.

Sumit leads the Corporate Legal vertical at eMinds Legal and is supported by a strong team of Corporate Lawyers at eMinds Legal who advise corporates for their routine corporate legal requirements.

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