Recommendation for changes in IndAS Compliant Schedule III to Companies Act 2013
1. Existing Schedule III defines the terms current asset, current liability and operating cycle as
AS 1 Disclosure of Accounting Policies does not define these terms. Para 66, 68 & 69 of
IndAS 1 Presentation of Financial Statements contains exactly similar definitions / guidance
for current asset, current liability and operating cycle.
Hence item 1-3 should be removed from general instructions for preparation of Balance
sheet.
2. The presentation of reserves may be align with existing presentation of reserves under
Schedule III.
Retained Earnings may be considered as part of Reserves under “Other Equity”.Further
balance of Securities Premium may be shown as a separate line item. This will require
consequential changes in ‘Statement of Changes in Equity’.
Exposure Draft Format
Recommended format
Equity
Equity
(a) Equity share capital
(a) Equity share capital
(b) Other Equity
(b) Other Equity
(i)Equity component of other financial
(i) Reserves
instruments
1.1 Retained Earnings
(ii) Retained Earnings
1.2 Securities premium
(iii) Reserves
1.3 Reserves representing unrealised
1.1 Reserves representing unrealised
gains/Losses
gains/Losses
1.4 Other Reserves
1.2 Other Reserves
(ii) Money received against share warrants
(iv) Money received against share warrants
(iii) Others
(v) Others
3. Note (iv) Other Equity may be redrafted as:
A reserve specifically represented by earmarked investments shall disclose the fact of such
earmarked investments.
4. In the Balance sheet format, liabilities and assets classification contains heading financial. For
example ‘Financial liabilities’ and ‘Financial assets’. Other headings such as ‘Other current
liabilities’ also contains items which are financial in nature. IndAS 107 ‘Financial Instruments:
Disclosures’ also requires disclosure on financial and non-financial (specifically para 6) and
Companies will separately disclose the same.
Hence the separate heading ‘Financial liabilities’ and ‘Financial assets’ may be removed.
Income tax assets can be current and non-current. Capital work in progress can be part of
schedule instead of presenting on the face of Balance-sheet.
IndAS 27 format
Recommended format
Non-current liabilities
Non-current liabilities
(a) Financial Liabilities
(a) Borrowings
(i) Long-term borrowings
(b) Other non-current liabilities
(ii) Other financial liabilities
(c) Deferred tax liabilities (net)
(b) Long-term provisions
(c) Deferred tax liabilities (Net)
(d) Long-term provisions
IndAS 27 format
Recommended format
(d) Other non-current liabilities
Current liabilities
Current liabilities
(a) Financial Liabilities
(a) Borrowings
(i) Short Term Borrowings
(ii) Trade and other payables
(iii) Other financial liabilities
(b) Other current liabilities
(c) Short-term provisions
(b) Trade and other payables
(c) Other current liabilities
(d) Short-term provisions
(e) Income tax liabilities (net)
(d) Liabilities for Current Tax (Net)
Non-current assets
Non-current assets
(a) Property, Plant and Equipment
(a)Property, Plant and Equipment
(b) Capital work-in-progress
(b) Investment Property
(c) Investment Property
(c) Goodwill
(d) Goodwill
(d) Other Intangible assets
(e) Other Intangible assets
(e) Biological Assets
(f) Intangible assets under development
(f) Non-current investments
(g) Biological Assets other than bearer plants
(g) Long-term loans and advances
(h) Financial Assets
(h) Income tax assets (net)
(i) Non-current investments
(i) Other non-current assets
(ii) Long-term loans and advances
(i) Deferred tax assets (net)
(iii) Others
(i) Deferred tax assets (net)
(j) Other non-current assets
Current assets
Current assets
(a) Inventories
(a) Inventories
(b) Financial Assets
(b) Current investments
(i) Current investments
(c) Trade and other receivables
(ii) Trade and other receivables
(d) Cash and cash equivalents
(iii) Cash and cash equivalents
(e) Short-term loans and advances
(iv) Short-term loans and advances
(f) Income tax assets (net)
(c) Assets for Current Tax (Net)
(g) Other current assets
(d) Other current assets
5. Disclosure on terms and details on Bonds/Debentures should be applicable for ‘liability
component of other financial instruments’. In that case the disclosure should be provided for
the entire financial instrument (i.e. not just the liability component) in the long term borrowings
head.
6. Under note (iv) to Long-term borrowings, details on individual borrowings may be provided
under maturity periods as follows instead of for each Bonds/Debentures.
The maturity profile of long-term borrowing at the end of the reporting period is as follows:

12 months or less

1 – 3 Years

3 – 5 Years

Over 5 Years
7. In the break of borrowings, “from banks” may be redrafted as “from banks and similar financial
institutions”.
8. Existing issued IndAS 27 contains the term ‘special purpose entities’. However ED IndAS 110
& ED IndAS 27 does not contains the term ‘special purpose entities’. ED IndAS 112 provides
comprehensive disclosures on structured entities and interest in other entities.
Hence the disclosure on ‘controlled special purpose entities’ may be removed from noncurrent and current investments.
9. The term ‘diminution in value of investment’ is stated in existing AS 13 ‘Accounting for
Investments’. IndAS 36 ‘Impairment of Assets’and IndAS 109 ‘Financial Instruments’ covers
impairment of investments.
Hence this requirement may be rephrased as ‘Aggregate amount of impairment in the value
of investments’ in non-current and current investments.
10. The caption “Cash and cash equivalents” may be changed to “Cash and bankbalances,”
which may have two sub-headings, viz., “Cash and cashequivalents” and “Other bank
balances.” This is based on suggestion provided in ‘Guidance Note on the revised Schedule
VI to the Companies Act, 1956’.
11. The term ‘Exceptional Items’ is not defined in IndAS. Hence the same may be removed from
Statement of Profit and Loss. Disclosure of same as an additional information by way of notes
may be retained [Item 7(k)].
12. The ED has omitted requirement of disclosure of Revenue from Interest and Financial
Services. Companies may have subsidiaries engaged in financial services and these
subsidiaries will prepare IndAS Financial Statements for Consolidation purpose. The format
will be used even for preparation of Consolidated IndAS Financials.
Hence the disclosure of Revenue from Interest and Other financial services should be
provided under IndAS also.
13. Additional information on ‘expense on Employee Stock OptionScheme (ESOP) and Employee
Stock Purchase Plan (ESPP) may be redrafted as ‘Share based payments to employees’.
14. Para 35 of IndAS 1 allows an entity presents on a net basis gains and lossesarising from
agroup of similar transactions, for example, foreignexchange gains and losses or gains
andlosses arising on financialinstruments held for trading. However, an entity presents
suchgainsand losses separately if they are material.
Hence item (g) and (i) under Additional information for Statement of Profit and Loss may be
omitted.
15. The word translation appearing first time under caption ‘Net gain/loss on foreign currency
translation and translation (other than consideredas finance cost)’ should be ‘transactions.
16. In case of Companies covered under Sction 135, amount of expenditure incurred on CSR
activities is required to be disclosed under Schedule III.
In general instructions for preparation of statement of profit and loss under IndAS, this item
may also be considered.