The Ministry of Corporate Affairs (MCA) has earlier amended the formats for Division I and Division II to Schedule III to the Companies Act and has also notified the formats of Division III to Schedule III pertaining to Non-BankingFinancial Companies (NBFCs) that are required to comply with Indian
Accounting Standards (Ind AS).
The revised formats of Division III have brought changes with regard to the classification of trade payables, trade receivables and loan receivables. Also, with the amendments, there is change in the terminology of Schedule III to align it with Ind AS. As the Ind AS has become applicable on NBFCs that fall within the prescribed criteria w.e.f. 1st April, 2018, with the prescription of Division III to Schedule III, the presentation of the financial results will be in line with the Indian Accounting Standards. In light of the changes to Division III to Schedule III, a need was felt by the Institute of Chartered Accountants of India (ICAI) for providing appropriate guidance to the members so that the requirements of Schedule III can be complied with by the NBFCs that are required to prepare their financial statements as per Ind AS in letter and spirit.
I am happy that the Corporate Laws & Corporate Governance Committee of ICAI has undertaken the task of preparing the Guidance Note on the Division III to Schedule III of the Companies Act, 2013 for necessary guidance of NBFCs and all others involved. Detailed notes have also been provided on
various items of the Schedule III and issues and intricacies involved therein which will surely help the readers. I commend the efforts of CA. (Dr.) Debashis Mitra, Chairman, CA. Chandrashekhar V. Chitale, Vice-Chairman and all the members of the Corporate Laws & Corporate Governance Committee who have made invaluable contribution in preparing this Guidance Note. I am confident that the members and other stakeholders would find the Guidance Note immensely useful.
CA Prafulla P. Chhajed President ICAI
The Institute of Chartered Accountants of India (ICAI) through the Corporate Laws & Corporate Governance Committee (CLCGC) had issued GuidanceNotes on Division I and Division II to Schedule III to the Companies Act 2013and the same were revised on the basis of amendments which were notified by the Ministry of Corporate Affairs vide Notification dated 11.10.2018. In October, 2018, the Ministry of Corporate Affairs notified Division III to Schedule III to the Companies Act, 2013 which contained the format of Financial Statements as well as Disclosure Requirements for Non- Banking
Financial Companies (NBFCs) that are required to comply with the Indian
Accounting Standards (Ind AS). In view of the above, CLCGC of ICAI decided to bring out a Guidance Note on Division III to Schedule III to the Companies Act 2013. The Note provides guidance on each of the items of the Balance Sheet & Statement of Profit and Loss. Few illustrations have also been included on application of the principles provided in the Guidance Note. We would like to convey our sincere gratitude to the President of ICAI, CA. Prafulla P. Chhajed, and the Vice President ICAI, CA. Atul Kumar Gupta for supporting us in bringing out the publication. We are also thankful to all our
Central Council Colleagues & other Members /Special Invitees of the Committee for their valuable inputs in giving shape to this Guidance Note. Our special thanks to CA. Shriniwas Y. Joshi, Central Council Member and Convenor of the Study Group comprising of CA. Charanjit Attra, CA.
Sandeep Shah, CA. Ritesh Goyal, Shri Avinash Chander, CA. Krishna Vyas and CA. Manan Lakhani for their sincere efforts in bringing out this Publication.
The Committee would like to acknowledge the valuable inputs received from the Nominees of Reserve Bank of India to the Study Group namely Shri P.K. Chophla, Shri Anuj Sharma and Shri Sandeep Parmar.We would also like to thank Secretary to the Committee CA. Sarika Singhal
and Ms Seema Jangid and CA. Deepa Agarwal for their technical and
|Guidance Note on Division III to Schedule III to the Companies Act 2013 for NBFC that is required to comply with IND AS by CL&CGC ICAI – (05-11-2019)|