With the rejection of ED-18 on July 6, 1977, the longest running epic of the financial world "Inflation Accounting" has come to a standstill where U.K. accounting profession is living with "An Interim Recommendation" and the U.S. (through its SEC requirements) is content with disclosure of fragmented and piecemeal information about replacement cost. Accounting profession in India seems to be watching the debate will all curiosity and excitement. I wonder whether the professional accounting bodies here are just playing the role of spectators or sitting on the fence watching the developments in other countries before adopting any particular method for correcting inflationary effect on our financial statements. Nevertheless, we cannot remain inactive too long. It is high time for our accounting bodies to begin providing a platform to thrash out the problem and for our corporations to experiment with suggested methods. This paper seeks to examine and review critically the various stages in development of the concepts and practices of accounting for changing prices. SSAP 7, Sandilands, Morpeth (ED-18) and finally the Accounting Standard Committee's current "Inflation Accounting-An Interim Recommendation" are critically examined and evaluated. Managerial use of the suggested inflation- adjustment method is highlighted by a case study-"Management Reporting System in Hindustan Lever Limited."