In this guide · 9 sections
- General instructions and the face of the statements
- Schedule III disclosure checklist: equity and liabilities (A to H)
- Schedule III checklist: assets (I to S)
- Contingencies, other notes and additional regulatory information
- Statement of Profit and Loss: face and notes 1 to 5(i)
- Additional information: notes 5(ii) to 5(xi)
- Worked example: two rows that are often marked wrong
- FAQs
- Sources
- This Schedule III checklist covers Division I only: companies following the Accounting Standards under the Companies (Accounting Standards) Rules. Ind AS companies use Division II, which has different headings and wording.
- It runs line by line through the general instructions, the Balance Sheet notes A to Q (with FA and FB for trade payables), headings R to W, the fourteen items of additional regulatory information at Y, and the Statement of Profit and Loss with notes 2 to 5(xi).
- Small companies get no general exemption from Schedule III. Their relief is elsewhere: no cash flow statement under section 2(40), no CARO, and some Accounting Standard relaxations.
- Dates matter: the MSME split of trade payables came in 2015 (G.S.R. 679(E)). Current maturities moved to short-term borrowings, and most of the newer items were added, by G.S.R. 207(E) from 1 April 2021.
- The 1% rule reads "one per cent. of the revenue from operations or Rs.1,00,000, whichever is higher". The threshold is the higher of the two, not the lower.
Try SignReady: Draft the Division I statements and notes from the trial balance, with previous-year figures.
Start freeThis Schedule III compliance checklist covers every disclosure in Division I, the version for companies that follow the Accounting Standards (now notified in the Companies (Accounting Standards) Rules, 2021, although the Division I heading still names the 2006 Rules). Many Schedule III checklists online are written for Division II (Ind AS). Their headings ("other equity", "financial assets") and their wording do not apply to a non-Ind AS company. Here the checklist follows the Division I text in the Companies Act as amended to date, in the order of the Schedule. Mark each row Y (given), N (missing) or NA (does not arise; note why). For the format of each statement, see our Schedule III guide.
References: GI = general instructions at the top of Division I; BS = general instructions for the Balance Sheet (para 6 headings A to Y); PL = general instructions for the Statement of Profit and Loss. The Schedule's requirements are in addition to those in the Accounting Standards and the rest of the Act (GI 2). There is a short list of those at the end.
General instructions and the face of the statements
Detail on each point: Schedule III general instructions and rounding off, current and non-current classification and notes to accounts format.
| Requirement | Reference | Y / N / NA |
|---|---|---|
| Changes required by the Act or an Accounting Standard made to heads and sub-heads; Schedule modified accordingly | GI 1 | |
| Accounting Standard and other Companies Act disclosures given in the notes, in addition to the Schedule | GI 2 | |
| Notes give narrative descriptions or disaggregations and information on items not recognised; every face item cross-referenced to its note; detail balanced against aggregation | GI 3(i)–(ii) | |
| Figures rounded by Total Income: below ₹100 crore to hundreds, thousands, lakhs or millions, or decimals thereof; ₹100 crore or more to lakhs, millions or crores, or decimals thereof (rounding is mandatory since 2021) | GI 4(i) | |
| One unit used uniformly throughout | GI 4(ii) | |
| Comparatives for every item, including notes (except the first financial statements) | GI 5 | |
| Terms used as defined in the Accounting Standards | GI 6 | |
| Balance Sheet face in the Part I order; "Note No." column; additional line items, sub-line items and sub-totals presented where relevant to an understanding of the position or performance | Part I and Note to GI | |
| Trade payables split on the face: (A) micro and small enterprises, (B) others | Part I, I(4)(b) | |
| Assets and liabilities classified current or non-current by the four tests; operating cycle assumed to be 12 months if not identifiable | BS 1–3 | |
| Trade receivables and trade payables limited to goods or services in the normal course of business | BS 4–5 | |
| Cash flow statement included (not required for OPC, small, dormant or start-up private companies) | s.2(40); G.S.R. 583(E) |
Schedule III disclosure checklist: equity and liabilities (A to H)
Area guides: share capital and promoters' shareholding, reserves and surplus, borrowings and current maturities, MSME dues disclosure, trade receivables and payables ageing and other current liabilities and provisions.
| Requirement | Reference | Y / N / NA |
|---|---|---|
| Share capital, for each class: authorised, issued, subscribed and fully paid, subscribed not fully paid; par value | BS 6A(a)–(c) | |
| Reconciliation of number of shares, opening to closing | 6A(d) | |
| Rights, preferences and restrictions of each class | 6A(e) | |
| Shares held by holding or ultimate holding company and their subsidiaries or associates | 6A(f) | |
| Each shareholder holding more than 5%, with number of shares | 6A(g) | |
| Shares reserved under options or contracts; five-year history of shares issued for consideration other than cash, bonus shares and buy-backs | 6A(h)–(i) | |
| Convertible securities' terms; calls unpaid (by directors and officers); forfeited shares | 6A(j)–(l) | |
| Promoters' shareholding table, class-wise, with % change during the year | 6A(m) | |
| Reserves and surplus under the eight heads, with additions and deductions for each | 6B(i) | |
| Reserve backed by earmarked investments called a "fund" | 6B(ii) | |
| Debit balance of profit and loss shown as negative surplus; total reserves shown even if negative | 6B(iii) | |
| Long-term borrowings under the seven heads; secured and unsecured; nature of security | 6C(i)–(ii) | |
| Aggregate of loans guaranteed by directors or others, by head | 6C(iii) | |
| Bonds or debentures in descending order of maturity, with rate and redemption terms; redeemed ones re-issuable | 6C(iv)–(v) | |
| Terms of repayment of term and other loans | 6C(vi) | |
| Period and amount of continuing default in loans and interest | 6C(vii) | |
| Other long-term liabilities: trade payables, others. Long-term provisions: employee benefits, others | 6D, 6E | |
| Short-term borrowings under the four heads; secured and unsecured; guarantees; defaults | 6F(i)–(iv) | |
| Current maturities of long-term borrowings shown separately within short-term borrowings | 6F(v) | |
| MSME note: principal and interest unpaid; interest paid under s.16 with late payments; interest due for delay; interest accrued and unpaid; further interest carried forward (s.23 MSMED Act) | 6FA(a)–(e) | |
| Trade payables ageing from due date, or from the transaction date where no due date is specified (under 1 year, 1–2, 2–3, over 3 years), for MSME, others and disputed dues of each | 6FB | |
| Unbilled dues shown separately (ICAI Guidance Note: add "Unbilled" and "Not due" columns so the total ties) | 6FB | |
| Other current liabilities under heads (b) to (j): lease obligations, interest accrued, income in advance, unpaid dividends, refundable application money, unpaid matured deposits and debentures, other payables | 6G | |
| Share application money: terms, sufficiency of authorised capital, period pending and reasons | 6G(g) | |
| Short-term provisions: employee benefits, others | 6H |
SignReady drafts the Schedule III Balance Sheet, Statement of Profit and Loss and notes from the trial balances as an editable Excel file. It includes previous-year figures, the trade payables MSME split and note, the ageing schedules and the eleven ratios with variance %.
Schedule III checklist: assets (I to S)
Area guides: PPE and CWIP ageing, investments, deferred tax, loans and advances, inventories and cash and cash equivalents.
| Requirement | Reference | Y / N / NA |
|---|---|---|
| PPE by the seven classes; leased assets shown separately in each class | 6I(i)–(ii) | |
| Gross and net carrying amount reconciliation: additions, disposals, business combinations, revaluation (if 10% or more), depreciation, impairment | 6I(iii) | |
| Write-off on reduction of capital or revaluation, or addition on revaluation, shown in a note with the date for five years | 6I(iv) | |
| Intangible assets by the nine classes, with the same reconciliation and five-year note | 6J | |
| Non-current investments: trade and other, under the eight heads; names of bodies corporate, flagging subsidiaries, associates, JVs, SPEs; partly paid | 6K(i) | |
| Partnership firm investments: firm name, all partners, total capital, shares | 6K(i) | |
| Investments not at cost: basis of valuation | 6K(ii) | |
| Quoted (with market value) and unquoted aggregates; provision for diminution | 6K(iii); 6N(ii) | |
| Current investments under the seven heads, same details, basis of valuation of each | 6N | |
| Long-term loans and advances: capital advances, related parties (with details), others | 6L(i) | |
| Secured good, unsecured good, doubtful; allowance shown separately | 6L(ii)–(iii); 6R(ii)–(iii) | |
| Amounts due from directors, officers, or firms or private companies in which a director is partner, director or member | 6L(iv); 6R(iv) | |
| Other non-current assets: long-term trade receivables, security deposits, others; receivables sub-classified, with ageing | 6M | |
| Inventories under the seven heads; goods-in-transit under the relevant sub-head; mode of valuation | 6O | |
| Trade receivables ageing from due date (under 6 months, 6–12 months, 1–2, 2–3, over 3 years): undisputed and disputed, good and doubtful; unbilled separately | 6P(i) | |
| Receivables: secured good, unsecured good, doubtful; allowance; dues from directors and officers | 6P(ii)–(iv) | |
| Cash and cash equivalents: bank balances, cheques on hand, cash, others | 6Q(i) | |
| Earmarked balances; margin money or security balances; repatriation restrictions; deposits over 12 months' maturity, each shown separately | 6Q(ii)–(v) | |
| Short-term loans and advances: related parties (with details), others | 6R(i) | |
| Other current assets, nature specified | 6S |
Contingencies, other notes and additional regulatory information
See contingent liabilities and commitments, additional regulatory information under Schedule III and Schedule III ratios and the 25% variance.
| Requirement | Reference | Y / N / NA |
|---|---|---|
| Contingent liabilities: claims not acknowledged as debt, guarantees, other | 6T(i) | |
| Commitments: capital contracts not provided for, uncalled liability on partly paid investments, other | 6T(ii) | |
| Proposed dividends and per-share amount; arrears of cumulative preference dividend | 6U | |
| Unutilised issue proceeds: how used or invested | 6V | |
| Bank or FI borrowings not used for the specific purpose: where used | 6VA | |
| Board's opinion that current assets (other than PPE, intangibles, non-current investments) are worth less than stated | 6W | |
| (i) Title deeds of immovable property not in the company's name (table) | 6Y(i) | |
| (ii) Revaluation of PPE: by registered valuer or not | 6Y(ii) | |
| (iii) Loans to promoters, directors, KMPs, related parties repayable on demand or without terms (amount and %) | 6Y(iii) | |
| (iv)–(v) CWIP and intangible assets under development: ageing; completion schedule if overdue or over cost; suspended projects | 6Y(iv)–(v) | |
| (vi) Benami property proceedings | 6Y(vi) | |
| (vii) Quarterly current-asset returns agree with books; else reconciliation and reasons | 6Y(vii) | |
| (viii) Wilful defaulter: date and defaults | 6Y(viii) | |
| (ix) Transactions with struck-off companies (table) | 6Y(ix) | |
| (x) Charges or satisfaction not registered within the statutory period | 6Y(x) | |
| (xi) Layers of companies not complied with | 6Y(xi) | |
| (xii) Eleven ratios, numerator and denominator explained, reasons for change above 25% | 6Y(xii) | |
| (xiii) Scheme of arrangement accounted for as per the Scheme and the Accounting Standards; deviations explained | 6Y(xiii) | |
| (xiv) Borrowed funds or share premium routed through intermediaries, given or received, with FEMA and PMLA declaration | 6Y(xiv) |
Every item except the ratios at (xii) arises only on its facts: (iii) only where such loans exist, (iv) and (v) only where there is CWIP or intangible assets under development, (vii) only where borrowings are secured on current assets, and (ix) only where there are transactions with struck-off companies. Where one does not arise, a short nil statement is common practice, backed by evidence on file.
Statement of Profit and Loss: face and notes 1 to 5(i)
Area guides: statement of profit and loss format, revenue from operations and other income, cost of materials consumed, employee benefits and finance costs, other expenses and the 1% rule, exceptional and prior period items and EPS under AS 20.
| Requirement | Reference | Y / N / NA |
|---|---|---|
| Face in Part II order: revenue, other income, Total Income, the seven expense lines, exceptional, extraordinary, tax (current and deferred), discontinuing operations, profit, EPS basic and diluted | Part II | |
| Not-for-profit (section 8) company: income and expenditure account in the same form | PL 1 | |
| Revenue from operations: sale of products, sale of services, grants or donations (section 8 only), other operating revenues, less excise duty (finance company: interest and other financial services) | PL 2(A) | |
| Finance costs: interest, other borrowing costs, applicable exchange differences | PL 3 | |
| Other income: interest, dividend, net gain or loss on sale of investments, other non-operating income net of direct expenses | PL 4 | |
| Employee benefits: salaries and wages, PF and other funds, ESOP and ESPP, staff welfare | PL 5(i)(a) | |
| Depreciation and amortisation | 5(i)(b) | |
| Any income or expense item above 1% of revenue from operations or ₹1,00,000, whichever is higher | 5(i)(c) | |
| Interest income; interest expense; dividend income; net gain or loss on sale of investments; adjustments to carrying amount of investments; other exchange differences | 5(i)(d)–(i) | |
| Payments to the auditor: as auditor, taxation, company law, management services, other services, reimbursement | 5(i)(j) | |
| CSR expenditure (section 135 companies) | 5(i)(k) | |
| Exceptional and extraordinary items; prior period items | 5(i)(l)–(m) |
Additional information: notes 5(ii) to 5(xi)
See also CSR, crypto currency and undisclosed income notes.
| Requirement | Reference | Y / N / NA |
|---|---|---|
| Manufacturing: raw materials and goods purchased under broad heads. Trading: purchases under broad heads. Services: gross income under broad heads | PL 5(ii) | |
| Work-in-progress under broad heads | 5(iii) | |
| Amounts set aside to, or withdrawn from, reserves (if material) | 5(iv) | |
| Amounts set aside to, or written back from, provisions (if material) | 5(v) | |
| Stores and spares consumed, power and fuel, rent, repairs to buildings, repairs to machinery, insurance, rates and taxes, miscellaneous: each separately | 5(vi) | |
| Dividends from, and provisions for losses of, subsidiaries | 5(vii) | |
| CIF value of imports; foreign currency expenditure; imported vs indigenous consumption with %; dividends remitted abroad; foreign exchange earnings | 5(viii) | |
| Undisclosed income surrendered in tax assessments, and whether recorded in the books | 5(ix) | |
| CSR: required, spent, shortfall, past shortfalls, reasons, nature, related party contributions, provision movement | 5(x) | |
| Crypto or virtual currency: profit or loss, holdings, deposits or advances received | 5(xi) |
The Act and the Standards add more (GI 2). For a small company the usual ones are accounting policies (AS 1), related parties (AS 18), employee benefits (AS 15, with SMC relaxations), EPS (AS 20), deferred tax (AS 22) and provisions and contingencies (AS 29). Add the section 186(4) particulars of loans, guarantees, security and investments. A Small and Medium Sized Company (SMC, as defined in the Companies (Accounting Standards) Rules, 2021) need not apply AS 17 segment reporting or give diluted EPS under AS 20. An SMC that uses any exemption or relaxation must say in a note that it is an SMC and has complied with the Accounting Standards as applicable to an SMC.
Worked example: two rows that are often marked wrong
A company has revenue from operations of ₹3,40,00,000 and Total Income of ₹3,52,00,000.
| Check | Working | Result |
|---|---|---|
| 1% rule, 5(i)(c) | 1% of ₹3,40,00,000 = ₹3,40,000; higher of that and ₹1,00,000 | Disclose any item above ₹3,40,000 |
| Rounding, GI 4(i) | Total Income below ₹100 crore | Hundreds, thousands, lakhs or millions, or decimals; one unit throughout |
In the notes it looks like this (₹ in lakhs, two decimals):
| Other expenses | 31.3.2026 | 31.3.2025 |
|---|---|---|
| Power and fuel | 6.12 | 5.48 |
| Rent | 4.80 | 4.80 |
| Freight outward | 3.95 | 2.10 |
| Payments to the auditor (statutory audit) | 0.75 | 0.65 |
| Miscellaneous expenses | 2.31 | 2.07 |
| Total | 17.93 | 15.10 |
Freight (₹3.95 lakh) exceeds the ₹3.40 lakh threshold, so it is shown separately. Rent and power and fuel are listed by name under 5(vi) whatever their size. Payments to the auditor are listed under 5(i)(j). An item below ₹3.40 lakh that is not on either list can sit in miscellaneous. Applying the lower figure instead (₹1,00,000 here) only adds lines; it does not breach the rule. Missing an item above the threshold does.
When the checklist is done, file it with the statements it was ticked against and initial each NA. A checklist ticked against an earlier draft proves little once the trial balance changes.
Try SignReady: FinalCheck flags notes that do not tie to the face.
Start free- Balance sheet not tallying
- 9 Schedule III mistakes
- Tally TB to Schedule III
- Tally groups to Schedule III
Frequently asked questions
Is there a Schedule III checklist for non-Ind AS companies?
Yes. This one follows Division I of Schedule III, which applies to companies following the Accounting Standards under the Companies (Accounting Standards) Rules. Ind AS companies follow Division II, whose headings and disclosures differ.
Do small companies have to follow all Schedule III disclosures?
Yes. Schedule III has no general exemption for small companies. Each disclosure applies on its facts. A small company may omit the cash flow statement under section 2(40), is outside CARO 2020, and gets some relaxations under the Accounting Standards.
What is the 1% rule in Schedule III?
Note 5(i)(c) of the Statement of Profit and Loss instructions requires separate disclosure of any item of income or expenditure that exceeds one per cent of revenue from operations or ₹1,00,000, whichever is higher.
Where is current maturity of long-term debt shown in Schedule III?
Under short-term borrowings, disclosed separately (Balance Sheet instruction F(v)). G.S.R. 207(E) moved it there from other current liabilities with effect from 1 April 2021.
When did the MSME split of trade payables start in Schedule III?
G.S.R. 679(E) of 4 September 2015 split trade payables on the face into dues to micro and small enterprises and others, and inserted the MSME note at heading FA. The ageing schedule at FB came later, through G.S.R. 207(E) from 1 April 2021.
Sources
- Companies Act, 2013 — Schedule III Division I and section 2(40) (India Code, as amended)
- Schedule III amendment — G.S.R. 207(E), 24 March 2021 (Gazette)
- ICAI — Guidance Note on Division I – Non Ind AS Schedule III to the Companies Act, 2013 (Revised January 2022)
- MCA — G.S.R. 679(E), 4 September 2015 (trade payables MSME split and note FA)
- MCA — G.S.R. 583(E), 13 June 2017 (exemptions to private companies; cash flow for start-ups)
SignReady generates the Schedule III statements from your trial balance as editable Excel, with formulas linking notes to the face. FinalCheck then flags arithmetic and cross-reference differences and compares key figures with the trial balance. First 3 finalisations free.
Audit and accounts updates, practical tips and knowledge: join the Audit and Accounts Update group on WhatsApp.
Version history: 28 Oct 2026 — first published.
