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Schedule III Balance Sheet Format for Companies  

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Schedule III is the statutory format prescribed under the Companies Act, 2013 for preparing a company's balance sheet and statement of profit and loss. The Ministry of Corporate Affairs (MCA) governs this schedule. Schedule III applies to every company registered under the Companies Act, 2013, except companies permitted to use a different format under a special act.

Schedule III replaced the earlier Schedule VI format used under the Companies Act, 1956.

What Is the Format of a Schedule III Balance Sheet?

A Schedule III balance sheet follows a vertical format with 2 main headings: Equity and Liabilities, and Assets. Each heading is broken into sub-headings, and each sub-heading is broken into line items.

Equity and Liabilities includes 4 sub-headings:

  • Shareholders' Funds
  • Share Application Money Pending Allotment
  • Non-Current Liabilities
  • Current Liabilities

Assets includes 2 sub-headings:

  • Non-Current Assets
  • Current Assets

Notes to Accounts shall contain information in addition to that presented in the Financial Statements and shall provide further details and disclosures wherever required. Each relevant line  item must carry a note number that links to the notes to accounts section.

What Are the Divisions Under Schedule III?

Schedule III has 3 divisions. Each division applies to a different category of company.

  • Division I applies to companies preparing financial statements under the accounting standards (AS) framework, not Ind AS.
  • Division II applies to companies preparing financial statements under Indian Accounting Standards (Ind AS), excluding banking and insurance companies.
  • Division III applies to non-banking financial companies (NBFCs) preparing financial statements under Ind AS.

Each division prescribes a distinct balance sheet format and distinct disclosure requirements matched to its accounting framework.

What Is the Difference Between Division I and Division II?

Division I and Division II differ in accounting framework, applicable companies, and disclosure depth.

Criteria

Division I

Division II

Accounting framework

AS (Accounting Standards)

Ind AS (Indian Accounting Standards)

Applicable companies

Companies not required to follow Ind AS

Companies required to follow Ind AS (based on net worth and listing thresholds)

Fair value disclosures

Not required

Required

Format basis

Cost-based presentation

Fair-value-oriented presentation

Statement of changes in equity

Not mandatory

Mandatory

Division II of Schedule III applies to companies required to comply with Ind AS, including listed companies and unlisted companies meeting the applicable net-worth threshold of ₹250 crore or more 

Is Schedule III Format Mandatory for All Companies?

Schedule III format is mandatory for all companies registered under the Companies Act, 2013. Banking companies, insurance companies, and companies governed by a separate act follow the format prescribed under that specific act instead.

A company cannot depart from the prescribed format unless a specific exemption applies to its sector.

Schedule III applies to all companies registered under the Companies Act, 2013, with a few exceptions. The following categories are exempt or follow a different framework:

  • Insurance companies: Governed by the Insurance Act, 1938, and use formats prescribed by the Insurance Regulatory and Development Authority of India (IRDAI).
  • Banking companies: Follow the Banking Regulation Act, 1949, and the formats prescribed by the Reserve Bank of India (RBI).
  • Electricity companies: These are subject to the Electricity Act, 2003.
  • Statutory companies: Any other category of company that is required to follow a prescribed financial statement format under the law specifically applicable to that entity. 

For all other companies, including private limited companies, public limited companies, one-person companies and producer companies, Schedule III applies.