The following points apply to Indian companies preparing financial statements as per Schedule III to the Companies Act, 2013:
Applicability: These guidelines apply to all Indian companies preparing financial statements as per Schedule III to the Companies Act, 2013.
Exceptions: These guidelines do not apply to (i) Insurance or Banking Companies, and (ii) Companies for which a specific form of balance sheet or income statement is specified under any other Act.
Primacy of Accounting Standards: In case of any conflict, accounting standards shall prevail over Schedule III of the Companies Act, 2013.
Mandatory Disclosures: Disclosures on the face of the financial statements or in the notes are essential and obligatory.
Meaning of Terms: The terms used in the revised Schedule III carry the meanings as defined by the applicable accounting standards.
Balance in Presentation: Companies need to strike a balance between providing sufficient information and avoiding excessive details that may not assist users of financial statements effectively.
Current and Non-Current Classification: Companies must bifurcate assets and liabilities into current and non-current categories as per the guidelines.
Rounding Off Requirements: It is mandatory to follow rounding off requirements.
Vertical Format: The prescribed format for presenting financial statements is vertical.
Debit Balance Treatment: Debit balances in the statement of profit and loss must be disclosed as negative figures under the head "Surplus."
Mandatory Share Application Disclosure: There is a mandatory disclosure requirement for share application money pending allotment.
Terminology Update: The terms "Sundry Debtors" and "Sundry Creditors" have been replaced by "Trade Receivables" and "Trade Payables," respectively. |
