SME Times News Bureau | 24 Jun, 2021
In a bid to enable more and more companies to avail greater flexibility
in the accounting standard, the Ministry of Corporate Affairs (MCA) has
expanded the ambit of small and medium companies (SMC) and has raised
their turnover and borrowing limits.
In a notification, the
ministry defined a small and medium sized company as an entity whose
equity or debt securities are not listed or are not in the process of
listing on any stock exchange, whether in India or outside India.
As
per the enhanced definition, the turnover of SMCs excluding other
income does not exceed Rs 250 crore in the immediately preceding
accounting year and their borrowings, including public deposits, are
not in excess of Rs 50 crore at any time during the immediately
preceding accounting year.
According to corporate experts, the
amendments would lead to less complexity in application of the
accounting standards in terms of the number of required disclosures and
make the process less complicated.
