prpri Exposure Draft Revised Guidance Note on Division I – Non Ind AS Schedule III to Companies Act, 2013 Exposure Draft Revised Guidance Note on Division I – Non Ind AS Schedule III to Companies Act, 2013

ED/GN-Div-I/2019-2020/23

EXPOSURE DRAFT
OF
REVISED GUIDANCE NOTE
ON
DIVISION I  NON IND AS
SCHEDULE III
TO THE COMPANIES ACT, 2013
(Last date for Comments: April 20, 2019)

Issued by Corporate Laws & Corporate Governance
Committee
THE INSTITUTE OF CHARTERED
ACCOUNTANTS OF INDIA
(Set up under an Act of Parliament)

Exposure Draft of Revised Guidance Note on Division I – Non Ind AS Schedule III to the Companies Act, 2013 by Corporate Laws & Corporate Governance Committee ICAI

Exposure Draft
Revised Guidance Note
on
Division I – Non Ind AS Schedule III
to the Companies Act, 2013

Following is the Exposure Draft of the Guidance Note on Division I – Non Ind AS Schedule III to the Companies Act, 2013 issued by the Corporate Laws & Corporate Governance Committee of the Institute of Chartered Accountants of India, for comments.

The Committee invites comments on any aspect of this Exposure Draft. Comments are most helpful if they indicate the specific paragraph or group of paragraphs to which they relate, contain a clear rationale and, where applicable, provide a suggestion for alternative wording.

Comments can be submitted using one of the following methods, so as to be received not later than April 20, 2019.

1. Electronically: Click on http: to submit comments online. (Preferred method): https://forms.gle /BzPdfRNtCE2dvvsk6

2. Email: Comments can be sent to clcgc@icai.in3. Postal: Corporate Laws & Corporate Governance Committee, The Institute of Chartered Accountants of India, ICAI Bhawan, A- 29, Sector- 62, Noida – 203209.

Further clarifications on any aspect of this Exposure Draft may be sought by e-mail to clcgc@icai.in.

Index

S.No. Contents Page No.
1. Introduction 2
2. Objective and Scope 2
3. Applicability 3
4. Summary of Division I to the Schedule III 4
5. Structure of Division I to the Schedule III 5
6. General Instructions to Division I to Schedule III 5
7. General Instructions For Preparation of Balance
Sheet: Notes 1 to 5
9
8. Part I Form of Balance Sheet and Note 6 to General Instructions For Preparation of Balance Sheet 15
9. Part II- Statement of Profit and Loss 51
10. Other additional information to be disclosed by way of Notes to Statement of Profit and Loss 67
11. Other Disclosures 74
12. Multiple Activity Companies 88
13. Consolidated Financial Statements 88
Annexures
Annexure A – Division I to the Schedule III to the Companies Act 2013 98
Annexure B – Illustrative List of Disclosures required under the Companies Act, 2013 119
Annexure C – List of Accounting Standards notified as on date 121
Annexure D- General Circular No. 39 / 2014 dated 14th October 2014 123

Exposure Draft of Revised Guidance Note on Division I – Non Ind AS Schedule III to the Companies Act, 2013 by Corporate Laws & Corporate Governance Committee ICAI

1. Introduction

1.1 Schedule III to the Companies Act, 2013 (the Act‘) provides the manner in which every company registered under the Act shall prepare its Balance Sheet, Statement of Profit and Loss and notes thereto. In the light of various economic and regulatory reforms that have taken place for companies over the last several years, there was a need for harmonizing and synchronizing the notified Accounting Standards as applicable (AS‘/Accounting Standard(s)‘). The relevant Schedule III to the Act is given in Annexure A (pg 98). As per the Act and rules / notifications thereunder, the Schedule applies to all companies, except for those companies where Division II and Division III of the Schedule III is applicable, for the Financial Statements to be prepared for the financial year commencing on or after April 1, 2014. This Guidance Note also incorporates the changes made by MCA Notification dated 11 October 2018 to Division I to the Schedule III (hereinafter, referred to as Schedule III‘).

1.2 The requirements of the Schedule III however, do not apply to companies as referred to in the proviso to Section 129(1) of the Act, i.e., any insurance or banking company, or any company engaged in the generation or supply of electricity or to any other class of company for which a form of Balance Sheet and Statement of Profit and Loss has been specified in or under any other Act governing such class of company.

1.3 It may be clarified that for companies engaged in the generation and supply of electricity, however, neither the Electricity Act, 2003, nor the rules framed thereunder, prescribe any specific format for presentation of Financial Statements by an electricity company. Section 1 (4) of the Companies Act states that the Companies Act will apply to electricity companies, to the extent it is not inconsistent with the provisions of the Electricity Act. Keeping this in view, Schedule III may be followed by such companies till the time any other format is prescribed by the relevant statute.

2. Objective and Scope

2.1. The objective of this Guidance Note is to provide guidance in the preparation and presentation of Financial Statements of companies in accordance with various aspects of the Schedule III. However, it does not provide guidance on disclosure requirements under Accounting Standards, Exposure Draft of Revised Guidance Note on Division I – Non Ind AS Schedule III to the Companies Act, 2013 by Corporate Laws & Corporate Governance Committee ICAI other pronouncements of the Institute of Chartered Accountants of India (ICAI), other statutes, etc.

2.2. In preparing this Guidance Note, reference has been made to the Accounting standards notified under Section 133 of the Companies Act, 2013 read together with Paragraph 7 of the Companies (Accounts) Rules, 2014 given in Annexure C (Pg 121) and various other pronouncements of the ICAI. The primary focus of the Guidance Note has been to lay down broad guidelines to deal with practical issues that may arise in the implementation of the Schedule III.

2.3. As per the clarification issued by ICAI regarding the authority attached to the Documents Issued by ICAI, ―‗Guidance Notes are primarily designed to provide guidance to members on matters which may arise in the course of their professional work and on which they may desire assistance in resolving issues which may pose difficulty. Guidance Notes are recommendatory in nature. A member should ordinarily follow recommendations in a guidance note relating to an auditing matter except where he is satisfied that in the circumstances of the case, it may not be necessary to do so. Similarly, while discharging his attest function, a member should examine whether the recommendations in a guidance note relating to an accounting matter have been followed or not. If the same have not been followed, the member should consider whether keeping in view the circumstances of the case, a disclosure in his report is necessary.

3. Applicability

3.1. As per the Government Notification no. S.O. 902 (E) dated 26th March, 2015, the Schedule III is applicable for the Balance Sheet and Statement of Profit and Loss to be prepared for the financial year commencing on or after April 1, 2014.

3.2. The Schedule III requires that except in the case of the first Financial Statements laid before the company after incorporation, the corresponding amounts for the immediately preceding period are to be disclosed in the Financial Statements including the Notes to Accounts. Accordingly, corresponding information will have to be presented starting from the first year of application of the Schedule III. Thus for the Financial Statements prepared for the year 2014-15(1stApril 2014to 31st March 2015), corresponding amounts need to be given for the financial year 20 13-14.

3.3. Applicability of the Schedule III format to interim Financial Statements prepared by companies in the first year of application of the Schedule:

Download Full Texूूूुुुt

More Under CA, CS, CMA

Leave a Comment

Your email address will not be published. Required fields are marked *

Search Posts by Date

August 2021
M T W T F S S
 1
2345678
9101112131415
16171819202122
23242526272829
3031