Schedule III Balance Sheet in NetSuite

Are you looking to tailor your financial reports to align with Indian standards? We’ve got the perfect solution for you! Schedule III Reports are the financial statements prepared by following the guidelines provided in Schedule III of the Companies Act, 2013. As per the Companies Act, 2013, every company registered in India is required to prepare and file its financial statements with the Registrar of Companies. Our blog will through how you can achieve the Schedule III Balance Sheet and Profit & Loss Statement/Income Statement in NetSuite.

 

The Schedule III of the Companies Act, 2013 provides a structured format for the preparation and presentation of financial statements like the Balance Sheet, Profit & Loss Statement/Income Statement, and Cash Flow Statement. This schedule lays down the minimum requirements that companies must adhere to while preparing financial statements.

Let’s delve into more details about Schedule III:

• This provides general instructions for the preparation of the Balance Sheet, Profit & Loss Statement, and Cash Flow Statement.
• The financial statements should be prepared on an accrual basis and following the accounting standards notified by the central government.
• Schedule III will not apply to Insurance companies, Banking companies, or any company that is engaged in the generation/supply of electricity.
• Schedule III is aligned with the current Indian Accounting Standards (Ind AS) and the International Financial Reporting Standards (IFRS), making it easier for Indian companies to report their financials in a global context.
• The financial statement’s statistics will be rounded to the nearest “hundreds, thousands, lakhs, millions, or decimals” and “lakhs, millions, or crores, or decimals” of that amount if the company’s total revenue is “less than” or “greater than” INR 100 crores respectively.
• The Schedule III reports help in building trust and confidence among stakeholders, including investors, creditors, and regulatory authorities. And it enables stakeholders to compare the financial performance of different companies on a like-for-like basis.
• Schedule III provides clear instructions on the minimum requirements for the balance sheet and statement of profit and loss, ensuring transparency and accuracy in financial reporting.
• The standardized format makes it easier for auditors and regulatory authorities to review and verify the financial statements of a company.
• Companies must ensure that they comply with the guidelines provided in Schedule III and other applicable regulations to maintain their credibility and reputation in the market.

 

Balance Sheet:

1. Netsuite Native Balance Sheet:

As per the Native NetSuite format, the Balance Sheet includes two sections Assets, Liabilities & Equity. These two sections are categorized into subsections as the Current Assets, Fixed Assets, Other Assets and Current Liabilities, Long Term Liabilities, Equity sections respectively. NetSuite Standard Balance sheet accounts will be categorized into these sections respectively. 

2. Balance Sheet Customized as per Schedule III:
   In Netsuite, the Balance Sheet can be achieved as per Schedule III format through customizing the report layout by including the sections as per the Schedule III format and categorizing the Balance Sheet accounts into each section. The Schedule III Balance Sheet contains two main sections Assets and Liabilities & Equity, which is similar to the Native NetSuite Report but these main sections are categorized into subsections and these subsections are categorized into further subsections as shown in the below Schedule III Balance Sheet Report.

• Assets
  • Current Assets 
  • Non-Current Assets 
• Liabilities & Equity
  • Current Liabilities 
  • Non-current Liabilities 
  • Shareholders’ Equity

Profit & Loss Statement/ Income Statement:

1. Netsuite Native Profit & Loss Statement/ Income Statement:
   As per the Native NetSuite format, Profit and Loss Statement/ Income Statement includes two sections Sales, Purchases, Gross Profit, Overheads, Operating Profit, Other Income, Other Expense, and Net Profit/(Loss) sections. 

The Profit and Loss Statement/Income Statement includes the accounts of type such as Cost of Goods Sold, Expense, Income, Other Expenses, and Other Income in their respective sections.

2. 2. Profit & Loss Statement/ Income Statement Customized as per Schedule III:

As per Schedule III  the Netsuite Profit & Loss Statement/Income Statement can be customized. By modifying the report layout of the statement we can achieve this.
Schedule III Profit & Loss Statement/Income Statement contains the below sections and their respective subsections. Income Statement accounts have to be categorized into the below sections while customizing. 

• Revenue
  • Revenue from Operations
  • Other Income
• Expenses
  • Cost of Sales
  • Expenses
  • Depreciation and Amortization
  • Other Expenses
• Profit Before Tax
• Tax Expense
• Profit After Tax

 

Reach out to us and talk to an expert NetSuite consultant to know more about the powerful reporting features of NetSuite which enables your finance team to achieve success in the competitive Indian market.