Schedule vi

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RAHUL SUDI (Querist)
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23 July 2013 Pvt ltd company is incorated as on 1-4-12 but not started business operations and incured some expenses.The company is liquidating in same financial year .Please tell me Which Disclosures I have to Make While preparing Balance Sheet As Per Schedule VI.

CA Vijeta Verma

CA Vijeta Verma (Expert)
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23 July 2013 I think Revised schedule will be applicable because there is a specific clause for non applicabilty .And as far as my knowledge is concerned there is no restriction on applicablity of revised schedule in this case

RAHUL SUDI

RAHUL SUDI (Querist)
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23 July 2013 no expense wil come in p&l account na?
all exp to be cppitalised na?wt disclosure i have to make in prep of balance sheet.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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23 July 2025 For your Pvt Ltd company incorporated on 1-4-12, which did not start business operations but incurred some expenses and is liquidating in the same financial year, here’s how to handle disclosures as per **Schedule VI (Revised Schedule VI applicable from 1-4-2013)**:

### Key points:

1. **Applicability**:
Since the company is incorporated during the year and preparing financials for the same period, **Revised Schedule VI** would apply if the financial year ends on or after 1-4-2013. If it is before, then the old Schedule VI applies.

2. **Expenses**:

* Expenses incurred before commencement of business are generally treated as **preliminary expenses or deferred revenue expenditure**.
* They can either be **capitalized as an intangible asset** or shown under **“Miscellaneous Expenditure” (to the extent not written off)** as per the old schedule.
* As per Revised Schedule VI, **there is no separate head for preliminary expenses**; such expenses are either capitalized as an asset or written off to P\&L.

3. **P\&L Account**:

* Since no business operations started, **there may be no trading or revenue income**.
* If the expenses are written off, they appear in the P\&L as “Other Expenses.”
* If capitalized, the expense will be shown as an asset in the balance sheet.

4. **Disclosures in Balance Sheet as per Schedule VI**:

* **Capital Work in Progress** or **Intangible Assets** (if expenses are capitalized).
* If expenses are written off, **Profit & Loss account will show net loss**.
* Under “Notes on Accounts,” disclose nature and treatment of such expenses.
* Show **Current Liabilities and Provisions** if any.
* Since company is liquidating, disclose the **liquidation status** in notes to accounts.

### Summary of disclosures:

| Particulars | Treatment/Disclosure |
| --------------------------------------- | ----------------------------------------- |
| Preliminary/Startup expenses | Capitalize as asset or write off in P\&L |
| No business revenue | Show loss in P\&L if expenses written off |
| Liquidation status | Disclose in notes to accounts |
| Fixed Assets / Capital Work in Progress | Show if expenses capitalized |
| Current Liabilities | Show separately |
| Share Capital | Show as per subscription |

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If you want, I can help you draft the exact **Balance Sheet format** and **Notes to Accounts** for this scenario based on Schedule VI!

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