GAAP Conversion: A Field Guide to Ind AS → IFRS

Ind AS is closely aligned with IFRS — but "closely" is where most conversion projects come undone. The alignments are structural; the divergences are in the footnotes, carve-outs, and transition provisions that quietly change the numbers.

This guide covers the differences that will actually move your balance sheet and P&L — and a sequencing approach that keeps month-end close running while the conversion is underway.

Why Ind AS ≠ IFRS

Ind AS incorporates carve-outs and carve-ins from IFRS to reflect Indian regulatory realities. The differences that matter most in practice:

• › Ind AS 101 vs IFRS 1: The transition date policy elections differ in subtle but material ways (deemed cost, cumulative translation differences).
• › Foreign exchange differences on long-term monetary items: Ind AS 21 permits capitalisation carve-out; IFRS does not.
• › Investment property: Ind AS 40 mandates cost model; IFRS 40 permits fair value model.
• › Revenue (IFRS 15): Core framework is aligned, but disclosure scope under IFRS is wider.

The Standards That Actually Move the Numbers

Revenue (IFRS 15 / Ind AS 115)

The 5-step model is identical. What's different in practice: contract-cost capitalisation, variable consideration estimates, and principal-vs-agent assessments often get restated during conversion because documentation under Ind AS tends to be lighter.

Leases (IFRS 16 / Ind AS 116)

Fully aligned. If your Ind AS IFRS 16 adoption was clean, this is a light-touch area. If not, it's the single largest source of balance-sheet restatement — right-of-use assets and lease liabilities are frequently understated.

Financial Instruments (IFRS 9 / Ind AS 109)

Aligned in framework. Divergence creeps in on ECL (expected credit loss) models — Ind AS reporters sometimes use simplified approaches that don't meet IFRS documentation rigor. Expect to rebuild ECL calculations with full staging and macro overlay documentation.

Deferred Tax (IFRS 12 / Ind AS 12)

The balance sheet approach is common. But the re-computation triggered by every IFRS reclassification can swing deferred tax materially. Run deferred tax last — after every other adjustment is locked.

Employee Benefits (IAS 19 / Ind AS 19)

Largely aligned, but the remeasurement of actuarial gains/losses via OCI must be rebuilt for the comparative period if not previously tracked at that granularity.

Business Combinations (IFRS 3 / Ind AS 103)

Aligned, but common-control transactions carved out in Ind AS may require retrospective re-recognition under IFRS. This is where many conversions stall.

A Sequencing Approach That Actually Works

We run conversions in four phases over 90–120 days, with the close running in parallel under Ind AS until the final cutover:

1. Phase 1 (Weeks 1–3) — Diagnostic: Standard-by-standard gap assessment. Identify which of your line items are actually affected; rule out the rest early.
2. Phase 2 (Weeks 4–8) — Policy & Election Decisions: IFRS 1 transition-date elections, deemed cost choices, accounting policy selections. Document each as a memo.
3. Phase 3 (Weeks 9–14) — Restatement: Build the parallel ledger. Restate opening balance sheet, comparatives, and current year. Run both Ind AS and IFRS reports side-by-side.
4. Phase 4 (Weeks 15–18) — Auditor Walkthrough & Sign-off: Walk auditors through each memo, support every judgment, close open items.

The Five Mistakes We See Repeatedly

1. Starting conversion without scoping the IFRS 1 elections — ends up in expensive rework.
2. Treating lease and ECL restatements as mechanical — they're judgment-heavy and need documentation.
3. Deferring deferred tax until the end is right; deferring it until after auditor walkthrough is not.
4. Missing the disclosure gap — IFRS notes are wider than Ind AS; the conversion isn't done until the notes are done.
5. Not training the in-house team — you'll be redoing the conversion next year otherwise.

The Execution Lens

A GAAP conversion is technical work, but it's also a project management discipline. The technical judgments land when the documentation, sequencing, and auditor engagement are right. Our conversion engagements own all three.