A. Introduction

MCA notified amendments to existing Schedule III by way of notification on 6th April 2016. Revised Schedule III is divided into DIVISION I and DIVISION II. The purpose of notification was to prescribe new format of P&L and Balance Sheet for IND AS Compliant Companies.

DIVISION I of New Schedule III is applicable for the Companies which are required to follow old accounting standards. DIVISION II of new Schedule III is applicable for IND AS Compliant Companies. Following table shows detailed comparison between DIVISION I and DIVISION II of New Schedule III.

B Comparison – New Schedule III DIVISION I and DIVISION II

Sr Particulars DIVISION I DIVISION II
1 Applicability Applicable for a company whose financials are prepared in compliance with Accounting Standards as per Companies ( Accounting Standards ) Rules, 2006. Applicable for a company whose financials are prepared in compliance with IND AS  as per Companies ( Indian Accounting Standards ) Rules, 2015.
2 Disclosure based on materiality No such disclosure based on materiality stated. The items individually or collectively influence the economic decision of the user are material items and such items shall be disclosed.
3 Disclosures by other Acts No specific requirement. The disclosures required by any Act or Regulation shall be in addition to disclosures specified in this schedule.
4 Components of  Financial Statement Financial Statement component specified  – (1) Balance Sheet (2) Statement of P&L (3) Notes Financial Statement component specified  – (1) Balance Sheet (2) Statement of Changes in Equity (3) Statement of P&L (4) Notes (5) Cash Flow Statement shall be prepared in compliance with IND AS when required.
5 Order of Balance Sheet Items Balance Sheet is prepared vertically and order followed is EQUITY AND LIABILITIES – ASSETS. Balance Sheet is prepared vertically and order followed is ASSETS – EQUITY AND LIABILITIES –
6 Bifurcation Balance Sheet items into Current –  Non Current / Financial – Non financial Balance Sheet items are classified into Current and Non-current. Balance Sheet items are further classified into Financial and Non-financial.
7 Property Plant & Equipments The order of classification is stated. Bearer Plants are introduced in the list of property plant and equipment.  Investment Property, Goodwill & Biological assets other than bearer plants needs to be disclosed separately as part of PPE.
8 Trade Receivables Trade receivables outstanding more than 6 months from due date needs to be stated separately. No such requirement.
9 Liabilities associated with assets classified as held for sale No separate disclosure. The disclosure shall be in accordance with requirements of Ind AS.
10 Retrospective change in accounting policy No such requirement. When there is retrospective change in accounting policy or restatement or reclassification of an item in financial statement, Balance Sheet at the beginning of the earliest comparative period shall be presented
11 Disclosure of Share Application Money Share application money pending allotment shall be classified as equity if it is not refundable otherwise it shall be disclosed separately in other financial liabilities.
12 Disclosure of Preference Shares including premium received Non- redeemable – Disclose as part of equity                                                           Redeemable – Disclose as Non- Current Liability
13 Disclosure of Compound Financial Instruments Split into equity and liability component as per Ind AS requirements.
14 Extra Ordinary Items Extra ordinary items are disclosed separately in the statement of profit and loss. No concept of extra ordinary items.
15 Other Comprehensive Income No concept of Other Comprehensive Income. Other Comprehensive Income items are separately disclosed.
16 EPS disclosures No such disclosure needed. EPS for discontinued operation and Eps for discontinued & continuing operation is separately disclosed.
17 Revenue in respect of Finance Company No such disclosure needed. Revenue shall be classified into Interest &  Other Financial Services
18 Threshold for separate disclosure of item of revenue and expenditure 1% of the revenue from operations or Rs. 1 Lacs, whichever is higher. 1% of the revenue from operations or Rs. 10 Lacs, whichever is higher.
19 Disclosures related to RM Consumption, WIP,  traded goods etc Required to disclose under broad heads. No such disclosure required.
20 Disclosure of CIF Value of Import CIF value of import in respect of RM, Components and spares and Capital Goods  needs to be disclosed by way of a note.  No such disclosure required.
21 Expenditure in FC Expenditure in FC in case of certain items needs to be disclosed.  No such disclosure required.
22 Disclosure of Indigenous and Imported items Total value of consumption of RM, Spares and Components needs to be disclosed with a bifurcation into Import and Indigenous items. Also percentage of Import and Indigenous item to total consumption needs to be disclosed.  No such disclosure required.
23 Remittance in FC on account of dividends Remittance in FC on account of dividends with specific mention of total number of non-resident shareholders and shares held by them and year on which divined related.  No such disclosure required.
24 Classification of earnings in FC Earnings in Foreign Currency shall be classified into (i) Export of goods on FOB (ii ) Royalty and professional fees (iii) Interest and dividend (iv) Other income  No such disclosure required.

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