New Schedule VI In the Offing

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Presentation. Legislature of India had constituted an Expert Committee on Company Law in 2005;The Committee in its report conceded the privilege of shareholders to be educated through straightforward exposure which ought not be in too much specialized format;The Committee was additionally of the perspective that Small Companies need not be liable to the expenses of an administration suited to extensive organizations with a wide partner

Presentation Transcript

Slide 1

´╗┐New Schedule VI (In the Offing) By: CA Kamal Garg

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Introduction Government of India had constituted an Expert Committee on Company Law in 2005; The Committee in its report conceded the privilege of shareholders to be educated through straightforward revelation which ought not be in exorbitantly specialized configuration; The Committee was additionally of the view that Small Companies require not be liable to the expenses of an administration suited to expansive organizations with a wide partner base

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ICAI's Role Ministry of Corporate Affairs had asked for the ICAI to audit Schedule VI keeping in mind the end goal to improve the same; The ICAI was likewise asked for to endorse a SARAL Schedule VI for little and medium estimated organizations; To do the work out, the Institute had constituted a Study Group : To detail the proposals on Schedule VI; and For recommending SARAL Schedule VI for little and medium measured organizations.

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Objectives Simplification of introduction ; Evaluate existing configuration regarding undesirable and obsolete revelations ; Harmonize and join with worldwide exposure prerequisites ; To limit divulgence necessities for Small and Micro Companies

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Updates Now The review assemble suggested the drafts of "Improved Schedule VI" and "SARAL Schedule VI" considering IFRS and Other detailing rehearses; The Corporate Laws Committee of the Institute considered the drafts of both the Schedules and settled the same; The drafts are being sent to the Ministry of Corporate Affairs and other Specified Bodies for remarks

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Structure of New Schedule VI Saral Schedule VI for SMCs: Divided into Parts I & II Simplified Schedule VI for Non-SMCs: Divided into Parts I, II & III

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SMC Conditions

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Key Changes Formats recommended for Profit and Loss record and Cash stream Statement ; However, Cash Flow Statement not required for SMCs

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Key Changes: Rounding of figures showing up in Financial explanations (has all the earmarks of being compulsory)

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Key Changes Schedule VI and Accounting Standards adaptability; The divulgence necessities determined in Schedule are notwithstanding and not in substitution of the exposure prerequisites indicated in the Accounting Standards endorsed under the Companies Act, 1956

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Key Changes Removal of bookkeeping treatment for trade pick up or misfortune identifying with settled resources obtained from outside India ; Separate set out presented toward "Share Application Money"

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Key Changes Schedules to the budgetary proclamations to shape some portion of notes records;

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Key Changes Presentation changes in asset report nearly on an indistinguishable lines from of IAS 1;

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Key Changes Additional Disclosure in regard of Share Capital; For Instance: Reconciliation of number of shares extraordinary toward the start of shares with shares toward the finish of period. Partakes in the organization held by any share holder holding more than 5 %

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Key Changes Reserves and excess: Debit adjust of benefit and misfortune record ought to be appeared under overflow; and Negative adjust of surplus in the wake of conforming against save ought to be appeared under save and excess, regardless of the possibility that resultant figure is negative.

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Key Changes Presentation changes in benefit and misfortune account : Specific configuration for P & L A/c recommended; It has commanded order of costs in light of capacity of cost strategy; Also, different exposure necessities of existing Schedule VI like quantitative subtle elements, wage from exchange and non-exchange speculations, measure of pay assessment deducted from gross wage and so on is not required.

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Materiality Any thing for which the cost surpass 1% of the incomes from operations of the Company or Rs. 50,000 (for SMCs) or Rs. 1,00,000 (for Non SMCs), whichever is higher, might be appeared as a different and particular thing; Result from ended operations to be unveiled independently in accordance with AS 24.

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Key Changes Significant lessening in repetitive and unimportant data : limit subtle elements, use/wage in remote money, points of interest of obligations/advances due from organizations under same administration and so on

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Part I for SMC

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Part II for SMC

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Part I for Non-SMCs

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Part II for Non-SMCs

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Part III for Non-SMCs Cash Flow Statement: Almost on an indistinguishable lines from AS 3

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