The revised Schedule begins with 'general instructions' that are applicable to both balance sheet and profit and loss account.
- Format of Balance Sheet : The next section is titled 'Part I - Form of Balance Sheet'. This section contains (i) a format of balance sheet and (ii) general instructions for preparation of balance sheet. The format is in vertical form and thus companies would not be permitted to present their balance sheet in horizontal form.
- Format of P & L A/c : The last section is titled 'Part II - Form of Statement of Profit and Loss'. This section contains (i) a format of statement of profit and loss and (ii) general instructions for preparation of statement of profit and loss. Thus, unlike the present position, a format for profit and loss statement has been prescribed. The prescribed format classifies the various expenses by their nature.
- No Format for Cash Flow : No format of cash flow statement has been prescribed in the revised Schedule. This is perhaps on account of the fact that Section 211 of the Act under which Schedule VI is formulated does not contain any reference to cash flow statement. However, AS 3, Cash Flow Statements, as notified will have to be complied with by companies to which it applies. AS 3 itself provides illustrative formats of cash flow statement.
- No Definition of Reserve / Provision : The revised Schedule makes it clear that the terms used therein have meanings assigned to them in respective accounting standards. Consequently (and unlike the existing Schedule), the revised Schedule does not contain definitions of' provision', 'reserve', 'capital reserve', 'revenue reserve', etc.
- Part IV not Carried Forward : The requirement of giving balance sheet abstract and general business profile, contained in Part IV of existing Schedule VI, is also not carried forward in the revised Schedule.
