Books of Accounts
D.P. Shah D. Shah & Associates 4
Companies Act 1956 Companies Act 2013
Section 209 to Section 223 governs Section 128 to Section 137 governs
provisions relating to accounts . provisions relating to accounts
Revised Schedule VI provides for Schedule III provides general
general instructions for preparation of instructions for preparation of Balance
Balance sheet and Statement of Profit sheet and Statement of profit and loss
and loss. of a Company
Schedule XIV to the Act provides the Schedule II provides Useful Lives to
rates at which depreciation is to be compute depreciation on various assets
provided on different class of assets ( on and manner of computing depreciation
WDV or SLM basis)
Section 350 providing ascertainment of Section 123 (2)
depreciation
Companies (Accounting Standard s) Companies (Account) Rules 2014 inter alia,
Rules 2006 provides:
a. Manner of keeping books of accounts.
b. Maintenance and inspection of certain
financial information by directors.
As a transitory provision Accounting
Standard rules 2006 continue to be in
force till the time new rules are
announced. (Rule 7)
Books
(d) in the case of a company (ii) all sales and purchases of goods
pertaining to any class of and services by the company;
companies engaged in production, (iii) the assets and liabilities of the
processing, manufacturing or company; and
mining activities, such particulars (iv) the items of cost as may be
relating to utilization of material or prescribed under section 148 in the
labor or to other items of cost as case of
may be prescribed, if such class of a company which belongs to any
companies is required by the class of companies specified under
Central Government to include that section; yet to be notified.
such particulars in the books of
account :
Contd..
PART B
4. The useful life or residual value of any specific
asset, as notified for accounting purposes by a
Regulatory Authority constituted under an Act of
Parliament or by the Central Government shall be
applied in calculating the depreciation to be
provided for such asset irrespective of the
requirements of this Schedule.
Depreciation (Contd.)
Componentization of assets mandated
Separate capitalization and depreciation of a part of
an asset if its cost is significant to the total cost of the
asset and its estimated life is different from the
remaining asset
Accounting for replacement costs.
Significant increase in rate of depreciation of commonly
used assets as compared to Schedule XIV rates under
the 1956 Act
D.P. Shah D. Shah & Associates 61
The Companies The
Nature of asset - illustrative Act, 2013 Compani Increas %
Useful Deeme es Act, e change
Life d rate 1956
General Plant and Machinery
other than continuous process
plant 15 6.33% 4.75% 1.58% 33.33%