Page 342 - DCOM201_ACCOUNTING_FOR_COMPANIES_I

Unit 14: Preparation of Final Accounts

The Balance Sheet must give a true and fair view of the company activities. This form may be in Notes
any other form with the consent of the Central Government.

Did u know? According to Institute of Chartered Accountants of India Balance Sheet as a
statement of the financial position of an enterprise at a given gate which exhibits its assets
liabilities capital, reserves and other account balances at their respective book values.
Form of Balance Sheet [Horizontal]
Balance Sheet of …………………………… Co. Ltd.
as on ………….........………
Figures Figures Figures
for the for the for the Figures for
previous Liabilities current previous Assets the previous
year
year year year
Share capital Fixed assets
Reserves and surplus Investments
Secured loans Current assets.
Unsecured loans Loan and advances
Current liabilities and (a) Current assets
provisions (b) Loans and
(a) Current liabilities advances
(b) Provisions Miscellaneous
expenditure
Profit and loss account

As it is clear from the above form of Balance Sheet, that Assets are shown on right hand side
whereas liabilities are put up on left hand side and relevant figures for the previous year as well
as for the current year are given but in case of Balance Sheet which is shown in vertical form
liabilities are put under one head i.e. ‘Sources of funds’ which is immediately followed by assets
under the head ‘Application of Funds’. This would be clear from the following exhibit of Balance
Sheet in vertical form.

Form of Balance Sheet [Vertical Form]
Balance Sheet of ………………………… Co. Ltd.
as on …………………………
Schedule Figures for the Figures for the
Particulars
No. Current Year Previous Year
1 2 3 4
I. Sources of Funds
1. Share Holders Funds
Share Capital + Reserves and Surplus
2. Loan Funds
(a) Secured Loans
(b) Unsecured Loans
Total
II. Application of Funds:
1. Fixed Assets
(a) Gross Block
(b) Less Depreciation
(c) Net Block
(d) Capital work in progress
Contd...
2. Investments
3. Current Assets, Loans and Advances
(a) Inventories
LOVELY PROFESSIONAL UNIVERSITY 335
(b) Sundry debtors
(c) Cash and Bank Balances
(d) Other Current Assets
(e) Loans and Advances
Less
Current Liabilities and Provisions
(a) Current Liabilities
(b) Provisions
Net Current Assets
4. Miscellaneous Expenditure (to the
extent not written off)
5. Profit and Loss Account
Total