ICAI introduces New Balance Sheet Format for Non-Corporate Entities; Implementation from April 1st
The Institute of Chartered Accountants of India (ICAI) has informed Chartered Accountants (CA) of increasing obligations in audit and compliance reporting, as a new format for maintaining balance sheets for non-corporate entities is slated to take effect on April 1, 2025.
The proposed revisions were communicated during a seminar held at the ICAI’s Bilaspur branch in Himachal Pradesh. The seminar, which was attended by a large number of CAs, intended to inform professionals about changes in the mode of financial reporting as a result of recent amendments to GST regime.
CA Navneet Sharma, who chaired the meeting, explained the specifics of the new balance sheet format, including its compatibility with Schedule-III of the Companies Act, 2013, which governs financial reporting formats for entities obliged to conform with the Companies (Accounting Standards) Rules, 2006.
The changes made to the reporting format are expected to promote openness and stringency in financial reporting, but will also increase the workload on CAs and other financial professionals, resulting in increased audit fees being charged to those who use their services.
Chairman of the ICAI Himachal Pradesh Branch, Naresh Vashist, advised professionals to inform clients that the revised format will have a significant impact on business entities of all sizes, resulting in grass-roots changes in audits and financial reporting, necessitating increased audit fees.
Another major topic of discussion was the GST Amnesty Scheme, which was introduced with the intention of reducing the burden of penalties on pending GST appeals by allowing disputed taxpayers to benefit from waivers or reductions in penalties if they pay the requisite penalties within the time-frame established by the GST Amnesty Scheme.
The initiative, which aims to reduce litigation and improve tax compliance, waives interest and penalties on non-fraudulent tax claims from FY 2017-18 to 2019-20.
To qualify from this relief, taxpayers must pay their outstanding balances by March 31, 2025.
CA Hanish Sharma, who led this part of the session, also provided an important update on the Input Tax Credit (ITC) for rental properties.
At first, a Supreme Court decision allowed ITC claims for buildings used for rental purposes. However, a recent retrospective revision to the GST law, effective from 2017, eliminated this benefit. Attendant CAs were advised to inform clients of this substantial development in order to avoid any conflicts and statutory action.
CA Chetan Sankhyan, a newly elected member of the managing committee, thanked those who attended and speakers and emphasised the seminar’s significance in light of changing financial legislation.
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