On 9th February, 2016, Ministry of Corporate Affairs issued draft format for financial statements (Revised Schedule III) in line with Indian Accounting Standards (Ind AS). The said format, if approved, shall be applicable on companies who are applying Ind AS voluntarily or shall apply mandatorily w.e.f 1st Aril 2016 or 1st April, 2017, as the case may be which is specified in Companies (Indian Accounting Standards) Rules, 2015.
Proposed revised Schedule III is similar to existing Schedule III of the Companies Act, 2013 subject to some differences. The major differences are as follows:
(i) The first half of the balance sheet requires presentation of assets and second part requires presentation of equity and liabilities, unlike present schedule III which requires presentation of equity and liabilities first and then assets.
(ii) Investment property, biological assets other than bearer plants, financial assets (categorised into investments, trade receivables, loans and others) shall be disclosed on the face of balance sheet under ‘Non-current assets’.
(iii) Reserves and surplus, money received against share warrants and share application money pending allotment shall be clubbed into a single heading “Other Equity” in the balance sheet.
(iv) “Other non-current assets” shall be classified into capital advances and advances other than capital advances.
(v) Preference shares shall be classified and presented as ‘Equity’ or ‘Liability’ in accordance with the requirements of relevant Ind AS. (vi) The Statement of profit and loss will include profit (a) profit or loss for the period; and (b) other comprehensive income for the period. Stakeholders can provide their comments on the draft by 23rd February, 2016.