AS 3 and NBFCs - urgent


There is a Non-Deposit Accepting NBFC (Company).

Accounting Standard -3 Cash Flow Statement is applicable for Level 1 Enterprises only.

The company does not have the 50 crores turnover in the preceding Accounting period for applying AS3.

Is my NBFC  a "Financial Institution" for getting applied AS-3.

What is "Financial Institution"  for applying AS-3?


The term "Financial Institution" has been defined in Companies (Acceptance of Deposits) Rules, 1975.


 the term 'financial institution' shall mean:-  
(a) a public financial institution specified in or under section 4A of the Companies Act, 1956 ;  
(b) a State Financial, Industrial or Investment Corporation ;  
(c) the State Bank of India or a subsidiary bank as defined in the State Bank of India (Subsidiary Banks) Act, 1959 (38 of 1959) ;  
(d) a nationalized bank, that  is to say, a corresponding new bank as defined in section 2 of :-  
(i)  the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970) ; or  
(ii) the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980);  
(e) the General Insurance Corporation of India established in pursuance of the provisions of section 9 of the General Insurance Business (Nationalization) Act, 1972 (57 of 1972);  
(f) the Industrial Reconstruction Corporation of India; or  
(g) any other Institution which the Central Government may, by 
notification, specify in this behalf.  
It may be noted that Statement on the Companies (Auditor's Report ) Order, 2003 issued by ICAi, it was stated in Para 22 that "Non-Banking Financial Company" is not a financial institution.


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