Advance paid and received against Property plant and Equipment

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Daya (Querist)
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14 June 2025 Advance paid and received against Property plant and equipment ,
how to present it according to scheduled III of company Act.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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12 August 2025 1. Advance Paid Against PPE (i.e., Advances to Suppliers for PPE)
Where to show: Under Non-current Assets (since PPE is a non-current asset).
Head:
“Capital Advances” (Schedule III classifies this under “Non-current Assets” → “Other Non-current Assets” section).
Explanation:
This is an advance given to vendors/suppliers for purchase/construction of PPE, hence treated as capital advance until asset is received.
2. Advance Received Against PPE (i.e., Advances received from customers for sale of PPE)
Where to show: Under Current Liabilities (since advance received is a liability until the asset is delivered).
Head:
“Other Current Liabilities” (you may disclose separately as “Advance from Customers for PPE Sale”).

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