ICAI has introduced a new financial statement format for non-corporate entities such as proprietorship firms, individual businesses, Limited Liability Partnerships (LLPs), partnership firms, societies, and others for FY 2024-25.
Now, non-corporates also need to prepare working notes, accounting notes, and detailed financial statements not only just P&L and balance sheet.
Applicability
As per ICAI's guidance note, the new format is applicable from 1st April 2024, for statements prepared for FY 2024-25.
ICAI Guidance Note
| June 2022 | ICAI released a Technical Guide on Financial Statements for Non-Corporate Entities to provide initial recommendations and formats. |
| August 2023 | The official Guidance Note on Financial Statements for Non-Corporate Entities was issued, specifying that it would take effect from 1st April 2024. |
| April 2024 | The Guidance Note became effective which means financial statements for the FY 2024-25 must follow this new format. |
Is There Any Change in Accounting?
There is no change in the way accounting is done in software like Tally or Zoho.
Changes are only in how financial statements are prepared and presented.
New Detailed Format
Click Here To Download - Formats for Financial Statements of Non-Corporate Entities
Click Here To Download - Formats for Financial Statements of Limited Liability Partnerships
Click Here To Download - Formats for Financial Statements of NPOs
ICAI’s Clarification Whether - Mandatory or Optional?
ICAI clarified that the guidance note is recommendatory in nature, not mandatory.
Professionals may choose to follow it, but it is not compulsory.
Recommendation
For small clients, following the new format may not be feasible due to time and fee constraints.
For large or serious clients, following the ICAI format is highly recommended for better presentation and compliance.
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