The International Financial Services Centres Authority (IFSCA) on April 08, 2026, issued the consultation paper on Mapping of Services Accounting Codes (SAC) and Introduction of Foreign Currency Expense Reporting for IFSC Units under SERF and MPR.
The following has been stated:
The primary objective is to enable accurate measurement of value creation in foreign currency by improving the consistency, clarity, and analytical usefulness of data reported through the Service Exports Reporting Form (SERF) and the Monthly Performance Report (MPR). IFSCA observed significant variations in current reporting practices, including inconsistent use of Service Accounting Codes (SAC), reliance on broad or residual categories, and absence of foreign currency expense data. These gaps limit comparability across entities and restrict the ability to assess sectoral and system-wide performance.
To address these issues, IFSCA proposes a sector-wise standardized mapping of SAC codes aligned with the nature of financial services and income streams generated by IFSC units, such as banking, insurance, fund management, and fintech activities. The framework is based on existing GST SAC classifications and emphasizes uniform treatment of similar services, without introducing new codes or altering regulatory or tax obligations. Additionally, enhancements already made to the SERF system—such as classification of service exports based on destination (outside India, other IFSC/SEZ units, and Domestic Tariff Area units)—further improve reporting granularity and visibility of service flows.
A key proposal in the paper is the introduction of a new reporting field in the MPR to capture aggregate monthly expenses incurred in foreign currency (converted into USD). This is intended to complement revenue data reported in SERF and enable calculation of net foreign currency value creation (FCVC), defined as the difference between gross foreign currency revenues and foreign currency expenses. This metric will support better policy analysis and assessment of IFSC’s economic contribution.
The proposed framework is designed to be flexible and proportionate, recognizing the diversity in size and business models of IFSC units, while still ensuring consistency in reporting. IFSCA may issue further guidance on revenue scope, expense categories, and reporting methodologies as needed. The consultation paper does not constitute a binding regulation but seeks stakeholder feedback on key aspects such as adequacy of SAC mapping, completeness of service coverage, practicality of implementation, and challenges in reporting foreign currency expenses. Comments are invited from stakeholders by April 29, 2026, following a prescribed submission format.
