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The Finance (No. 2) Act, 2024, initially led many to believe that indexation benefi ts had been restored for long-term capital gains on land and buildings - creating an illusion of relief. However, a closer look reveals that while the second proviso to Section 112(1)(a) offers a tax cap through a notional comparison with the pre-amendment regime, actual capital gains computation no longer includes indexed costs. This infl ates taxable income, leading to loss of the rebate and exposure to surcharge if income exceeds ₹50 lakh. Furthermore, capital losses arising due to indexation are no longer recognized, eliminating the option for carry forward or set-off
SA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, lays down the foundational principles for risk assessment in audit engagements. Whereas SA 330, Auditor’s Response to Assessed Risk, requires designing and performing the audit process to respond to such risk in an audit engagement. While both of these standards offer a comprehensive framework, their practical application, particularly at the level of individual account balances, often poses challenges in real-world audit scenarios. While the importance of risk identifi cation, assessment, and response is well understood by audit professionals, applying these concepts in a consistent and defensible way might be a practical challenge. This article explores these practical challenges and outlines a structured approach to help auditors more effectively identify, assess and respond to risks in line with the principles of SA 315 and SA 330.
The recent SC judgement in the case of Hyatt International Southwest Aisa Ltd.1 (Hyatt International) has again spurred the discussion around constituting a Permanent Establishment (PE) for a foreign company in India. The Hon’ble Supreme Court has upheld the decision of Delhi High Court and has hence ruled that, Hyatt International (global hotel chain) has a fi xed place PE in India and consequently, that its income derived under the Strategic Oversight Services Agreement (SOSA) entered in this respect is taxable in India. Post various landmark decisions like Formula One and E-Funds Inc., this is again an important development in the fi eld of PE that gives rise to various questions, as to when and under what circumstances can a foreign company be said to be having a PE in India. Here, the author has analyzed the various important judgments and basis that identifi ed the major conditions under which a PE for a foreign company can be triggered in India.
Ind AS 110 has transformed consolidation from a mechanical exercise into a battlefi eld of professional judgment. This article addresses the complex challenges faced by Indian Chartered Accountants in implementing control-based consolidation, covering real-world consolidation failures and their fi nancial impact on Indian corporates, practical frameworks for assessing control in Special Purpose Vehicle (SPVs), joint ventures, and structured entities, regulatory enforcement trends including recent SEBI penalties and NFRA quality reviews, sector-specifi c challenges in renewable energy, fi ntech, and startup ecosystems, and comprehensive documentation strategies that withstand regulatory scrutiny. With consolidationrelated penalties exceeding ₹50 crores, regulatory reviews exposing widespread audit quality defi ciencies, and increasing enforcement actions impacting CFOs and audit fi rms, mastering Ind AS 110 has become essential for career advancement and regulatory compliance in India’s evolving business environment.
This paper explores the evolution, benefi ts, and challenges of cloud-based accounting systems in the digital economy. Cloud-based accounting offers fl exibility to manage fi nances anytime, anywhere, enabling real-time collaboration, automation, cost savings, and regulatory compliance. Its popularity stems from mobile access, scalability, and integration with other business tools. However, issues such as cybersecurity, vendor lock-in, and internet reliance persist. Case studies highlight its impact on operational effi ciency across sectors. Emerging trends point to the growing infl uence of AI, blockchain, and stricter regulations, underscoring the strategic importance of cloud-based accounting in modern fi nancial management.
