The Institute of Chartered Accountants of India (ICAI) is the formulating body of the accounting standards in our country. As we globalize, the significance of convergence increases with International Financial Reporting Standards (IFRS). In today’s scenario of global business village India cannot afford to insulate itself from the developments and modifications taking place worldwide. These new set of accounting standards is more principles based as compared to the earlier standards that were basically a principle based. The objective of the present paper is to examine the structure, importance and advantages of IFRS in India; to study the process of convergence and how IFRS will affect the Indian banks. There are significant differences between the accounting treatments laid down in the existing Accounting Standards as against the treatments envisaged in the converged Indian Accounting Standards. These differences necessarily will have an impact on the depiction of profit and financial position of an enterprise.