Brief on amendments to Schedule III Division I to the Companies Act (for Companies whose financial statements are required to comply with the Accounting Standards). modified vide notification dated March 24, 2021 applicable to accounting years commencing on or after April 1st, 2021
Additional Disclosure are as under:
♦ For Balance Sheet
> Shareholding of Promotors:
Shareholding of Promoters and % Change during the year.
> Trade Payable (Creditors) ageing Schedule
As per the amended Schedule, companies are now required to disclose an ageing schedule with respect to duration of years of trade payables with disputed amount out of the total amount.
> Trade receivables (Debtors) ageing Schedule
Companies are now required to disclose an ageing schedule in respect of trade receivable for various periods, in the original schedule there was no requirement of disclosing the ageing of trade receivables beyond the period of 6 months.
> Title deeds of Immovable Property not held in name of the Company
Details of all the immovable properties (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee) whose title deeds are not held in the name of the company are to be disclosed in the specified format.
> Disclosure on Revaluation of Assets:
Where the Company has revalued its Property, Plant and Equipment, the company shall disclose as to whether the revaluation is based on the valuation by a registered valuer as defined under rule 2 of the Companies (Registered Valuers and Valuation) Rules, 2017. Limit of upward /down ward is 10 %.
> Disclosure on Loans/ Advance to Directors/ KMP/ Related parties:
Now more detailed disclosures are required where Loans or Advances in the nature of loans are granted to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013,) either severally or jointly with any other person.
> Capital-Work-in Progress (CWIP)
CWIP ageing to be now given with specified period and with further details as projects in progress and projects temporarily suspended.
> Details of Benami Property held
> Details of Borrowing
Where the Company has borrowings from banks or financial institutions on the basis of security of current assets, it shall disclose whether quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts and if not, summary of reconciliation and reasons of material discrepancies, if any to be adequately disclosed.
> Wilful Defaulter:
If a company is a declared wilful defaulter by any bank or financial Institution or other lender, Date of declaration as wilful defaulter and Details of defaults (amount and nature of defaults) to be disclosed as per new requirements.
> Relationship with Struck off Companies:
Where the company has any transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956, the Company shall disclose the information in the specified format.
> Registration of charges or satisfaction with Registrar of Companies
Where any charges or satisfaction yet to be registered with Registrar of Companies beyond the statutory period, details and reasons thereof shall be disclosed.
> Disclosure of Ratios:
The amendment requires the companies to disclose few ratios in the financials statement. Company shall explain the items included in the numerator and denominator for computing the above ratios and an explanation shall be provided for any change in the ratio by more than 25% as compared to the preceding year.
> Details in respect of Utilization of Borrowed funds and share premium
> Compliance with approved Scheme(s) of Arrangements
Where any Scheme of Arrangements has been approved by the Competent Authority in terms of sections 230 to 237 of the Companies Act, 2013, the Company shall disclose that the effect of such Scheme of Arrangements have been accounted for in the books of account of the Company ‘in accordance with the Scheme’ and ‘in accordance with accounting standards and deviation in this regard shall be explained of holding of the company in such downstream companies shall be disclosed.
♦ For Statement of Profit and Loss, –
Under the heading “III. Total Revenue (I +II)”, for the word “Revenue”, the word “Income” shall be substituted;
Under the heading “General Instructions for Preparation of Statement of Profit and Loss”, –
1. . In paragraph 2, in item (A), after sub-item (b), the following shall be inserted, namely: – Grants and donation received (in case section 8 companies only)
2. Additional information related to CSR Disclosure:
3. Undisclosed Income (Reconciliation of Income Tax and Companies Act):
4. Details of Crypto Currency or Virtual Currency:
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