Preparation of financial statements as per revised schedule

This query is : Resolved

Nishant Jain (Querist)
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27 May 2012 Respected Sir/Madam

I was preparing the financial statements as per the revised schedule VI. I am facing problems in classification of Creditors, Secured Loans, Unsecured Loans and the Loans and advances in to Current and Non-Current.

Kindly tell me the procedure to classify the same.

Thanks
Nishant Jain

Sanjay Chauhan (IFRS)

Sanjay Chauhan (IFRS) (Expert)
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27 May 2012 There are two criterias to do the classification:
1. Operating ccycle of business
2. Expected payment within 12 months from balance sheet date.

In all businesses except in businessess such as wineries, the operating cycle will be less than 12 months.

In your case, classify Creditors as current if the credit period of is less than 12 months and hence the contractual maturity of payment falls with 12 months of balance sheet date.

For loans, classify them according to their reoayment schedule based on the loans agreement. Assuming that there are no breaches and the loan is not called by the bank before signing.

Loans and advances are to be classified in similar approach of creditors. If the expected receipt of the loans and advances is after 12 months, then non current.

Demand loand and liabilities to be classified as current.

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