Advance paid and received against Property plant and Equipment
This query is : Resolved
14 June 2025
Advance paid and received against Property plant and equipment ,
how to present it according to scheduled III of company Act.
how to present it according to scheduled III of company Act.
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”).
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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