BALANCE SHEET OF COMPANIES

Click to edit Master subtitle style A PRESENTATION BY: AJITH SEBASTIAN HARSH MITTAL KAILASH SRINIVASAN KARTIK KULHARI NOEL JOSEPH WILLIAM SWATI GOSWAMI UPASANA SINGH USHMA BHANDARI

10/17/12

INTRODUCTION

According to AICPA*,

Balance sheet is a tabular statement of summary of balances (debits and credits) carried forward after an actual and constructive closing of books of account and kept according to the accounting principles

Format of balance sheet is as per Part I of Schedule VI in 10/17/12 Companies Act of 1956.

MARSHALLING
Arranging the balance sheet according to a particular sequence or order.

METHODS OF MARSHALLING

Liquidity Preference Method Rigidity Preference Method

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It is a statement but not an account It is a summary of unallocated balances

FEATURES OF BALANCE SHEET

It acts as a buffer between the transactions of two consecutive accounting periods

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It acts as a resource statement

PURPOSE OF BALANCE SHEET

Disclosure of values and natures of assets and liabilities

Information about solvency Information about liquidity Information about other necessary aspect
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a)

b)

c) d)

e)

SHAREHOLD ERS FUNDS

a) b)

the number and amount of shares authorized; the number of shares issued, subscribed and fully paid, and subscribed but not fully paid; par value per share; a reconciliation of the number of shares outstanding at the beginning and at the end of the period; shares in the company held by its holding company or its ultimate holding company or by its subsidiaries or Capital Reserves; associates; Capital Redemption

c) d)

e)

f)

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Reserves; Securities Premium Reserve; Debenture Redemption Reserve; Other Reserves (specify the nature of each reserve and the amount in respect thereof); Surplus i.e. balance in statement of Profit & Loss

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Share application money pending allotment not to be presented within Shareholders funds as a separate line item. It will not come in current liability also .
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SHARE APPLICATION MONEY PENDING ALLOTMENT

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a)

b)

c) d)

Loans repayable on demand Loans and advances from subsidiaries/holding company/associates/bus iness ventures. Demand deposits. Other loans and advances (specify nature).

The amounts shown under Trade Payables shall include the amounts due in respect of goods purchased or services received in the normal course of business.

a)

a)

b)

Provision for employee benefits. Others (specify nature).

b)

c)

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d)

Current maturities of long-term debt; Current maturities of finance lease obligations; Interest outstanding and due on borrowings; Unpaid dividend;

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These are provisions created on fixed assets. Ex. Provision for depreciation

a) b) c) d)

e)

Bonds/debentures. Term loans Public deposits. Loans and advances from subsidiaries/holding company/associates/bus iness ventures. Other loans and advances (specify nature).

Any other noncurrent liabilities (specify nature) 10/17/12

An account on a company's balance sheet that is a result of temporary differences between the company's accounting and tax carrying values, the anticipated and enacted income tax rate, and estimated taxes payable

Non- Current Assets

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a) b) c)

d)

Tangible Assets Intangible Assets Capital work in progress Intangible assets under development

a) b)

c)

d)

Investment property; Investments in Government or trust securities; Investments in units, debentures or bonds; Other non-current investments (specify nature)

Tax paid in advance based upon the estimated income

a)

a)

b)

c)

b)

Long Term Trade Receivables; 10/17/12 Others (specify

Capital Advances; Security Deposits; To directors / subsidiaries / associates / business ventures loans and advances to specify

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a) b) c) d) e) f) g)

Raw material; Work-in-progress; Finished goods; Stock-in-trade; Stores and spares; Loose tools; Others (specify nature).

a)

a) b) b) c) d) c)

Investments in government or trust Balances securities; with banks Cheques, drafts on hand Investments in shares, Cash in hand units, debentures or Others bonds; (specify nature) Other investments (specify nature).

a)

b)

Loans and advances t related parties ; Others (specify nature).

The amounts shown under Trade Receivables shall include the amounts due in respect of goods sold or 10/17/12 services rendered in the normal course of business.

This is a residual heading, which incorporates current assets that do not fit into any other asset categories.

Major Changes in the Revised Balance Sheet

Changes in the Liabilities Side
Sources of fund has been replaced with equity and liabilities. Money received against share warrants has been specifically categorized as sub head under Shareholders fund. Debit balance shall be shown as 10/17/12 negative figure under the head surplus

Major Changes Continued

Share application money pending allotment shall now be shown separately under Shareholder Funds. Liabilities will now be broadly classified as current liabilities and non-current liabilities. Deferred payment liabilities and loans & advances from related parties to be shown separately under the head 10/17/12 long term borrowings.

Changes In the Assets Side

Change in nomenclature- application of funds has been replaced with Assets. Fixed assets are to be further classified as tangible and non tangible. Current assets are to be shown under separate head. 10/17/12 Sundry debtors have been named trade receivables.

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