PF Balance in Balance Sheet

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This discussion clarifies how to present an individual's Provident Fund (PF) balance on their balance sheet. Experts confirm that both employer and employee shares of the PF balance can be classified as a long-term investment. They also advise that LIC premiums paid should be shown as an investment, rather than personal drawings.

Accoun tant

Accoun tant (Querist)
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22 May 2023 Dear Experts,

If an Individual has two source of Income ( Salaried & Business)

While preparing the Balance sheet for the Individual , shall we include the EPF balance under Long Term Investment. ( Both Employer Share and Employee Share) - Balance as per PF Website

I believe ESI Contribution cannot be consider under Investment - Kindly correct me if Im Wrong.

Kindly Advise

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 May 2023 Yes, It can be shown as long term investment.
Yes, you are right ESI contribution can't be considered as investment.

Accoun tant

Accoun tant (Querist)
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23 May 2023 Thank you so much sir.

Also do we need to Show - LIC Premium as investment

I believe it can be coded in Personal Drawings, since it is also for Longterm Investment purpose, do we need to show LIC Premium paid ( Accumulated value ) as investment

Kindly advise

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 May 2023 Yes show LIC premium paid as investment.

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