Implications Of Amendment Of Schedule VI Of The Companies Act, 1956

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: Schedule VI (“the Schedule”) of the Companies Act, 1956 (“the Act”) prescribes the minimum data that every company incorporated under the Act should publish in its audited Annual Accounts which are laid before the shareholders at the Annual General Meeting. The said Schedule is recently amended. The said Schedule being of prime importance and the basis of Annual Accounts of any company, listed or otherwise, private or public, it is incumbent to know the implications thereof. The Central Government is empowered under section 641(1) of the Act to amend the Schedule VI. Amendment Relating To Rounding Off The Figures In Annual Accounts: Earlier, para 3 in Part I in the said Schedule under the heading “B. Vertical Form” permitted any company preparing Balance Sheet in vertical form to round off the figures to the nearest “000” or “00” or figures may be expressed in decimals of thousands. The recent amendment introduced by the Notification No. GSR 545(E) dated 01.08.2002 issued by the Department of Company Affairs of Ministry of Finance and Company Affairs has further liberalised the said provision. Now, the companies preparing the Balance Sheet in vertical form are at more liberty to round off the figures as shown in the table hereunder: Where the Turnover of the company in any Financial Year is: Round Off is permissible:

a. Less than Rs. 100 Crore to the nearest “000” or “00” or decimals thereof. b. Rs. 100 Crore or more but less than Rs. 500 Crore : To the nearest “000,000” or “00,000” or “000” or “00” or decimals thereof. c. Rs. 500 Crore or more: To the nearest “00,00,000” or “000,000” or “00,000” or “000” or “00” or decimals thereof.