What industry insiders say about Current Senerio?

Industry wants  government to make this financial year a 15 months one due to COVID-19

industry experts point out that for all companies last one month has hugely impacted cash flow and that has resulted in their mark to market. extension of the financial year may spread the bad period over more months and could help the companies... 

The government in last few days reached out to several industry experts to seek their opinion on impact of such step,say people direct knowledge of the matter for the several companies there is a need to extend financial year to June end as most of their ratio toss due to Covid-19.It's only fair that companies are given additional time because even when tax deadline are extended, there is a pressure from revenue department to pay before march end, as that's the year end for them, said Dinesh Kanabar, CEO, Dhruva Advisors.

The impact of COVID-19 is huge and it may disrupt the business and the financial of the business for couple of quarters. Goverment was exploring the change in financial year and now if government is able to tweak the financial year, then the effect of coronavirus on financials could be spread over extended time frame, said Paras Savla, Partner, KPB & associates, a tax advisory.

 

The government had earlier toyed the idea of changing the financial year from April to March TO calendar year i.e January to December. In July 2016 a committee was constituted to look the proposal of moving to calendar year. A NITI AAYOG discussion note system in India in not aligned to international practices and causes a lot of problem.

 

Insiders say that due to current situation the government may consider whether to extend the current financial year to June or directly move to calendar year system.