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Accounting for Companies-I

Notes Section 220 is relating with the filing of accounts with register. As per this section three copies of
Balance Sheet, Profit and Loss A/c, and all other documents which are attached with the Balance
Sheet shall to be filed with the Registrar within thirty days after the annual general meeting.

Did u know? As per Section 212 of the Companies Act if any company is a holding of
another company, the holding company has to attach with its balance sheet the following
documents relating to its subsidiary company.

Task Discuss the rulings of different sections come under this final accounts of a company.

13.2 Form and Contents of Balance Sheet

Meaning of Balance Sheet

The balance sheet of a company is a statement which shows the total value of assets owned and
total of the company’s liabilities owed by of trading on a particular date or at the end of trading
period. Balance Sheet is also called the statement of assets and liabilities and net worth. Section
211 of the Companies Act provides that the Balance Sheet of the company shall give true and fair
view of the state of affairs of the company as at the end of the financial year. True and fair view
means that there should be no window-dressing on any item of the balance sheet. For the true
and fair view of the state of affairs of the company, assets and liabilities should be correctly
given, provisions should be shown in the sufficient amount, contingent assets and contingent
liabilities should be given as notes of the Balance Sheet and stock should be valued on the basis
of accounting principles.
According to Section 211(1) every balance sheet of the company shall be prepared in the form set
out in Part I of Schedule VI or as near thereto as circumstances permit, or in such other form as
may be laid down by the Central Government either generally or in a particular case. This Part
further states that in preparing the Balance Sheet due regard shall be had, as far as may be, to the
general instructions for preparation of Balance Sheet under the heading ‘Notes’ at the end of the
Part. Provisions of this Section do not apply to Banking. Insurance and Electricity Generation
and Supplying Companies because the Form of Balance Sheets of these companies are given in
the Act governing such class of companies. There are given two alternative formats of the
Balance Sheet in Part I of Schedule VI. These are the Horizontal form and the Vertical Form.
Companies are free to choose any one of these forms. Mostly, companies adopt the Horizontal
Form of Balance Sheet. These forms of Balance Sheet are given in Part I of Schedule VI of the
Companies Act given below:

13.2.1 Schedule VI – Part I (see Section 211) Form of Balance Sheet –
A Horizontal Form

(The balance sheet of a company shall be in Horizontal form or Vertical form)
Balance Sheet of ................ (Here, enter the name of company) as at ................ (Here, enter the date
at which the balance sheet in made out.)

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