
Old Notes Disclosure by Companies
The Lok Sabha has recently passed the Specified Bank Notes (Cessation of Liabilities) Bill, 2017. The Bill related to the holding, transfer and receiving of old Rs.500 and Rs.1000 denomination currency makes it unlawful to hold, transfer or receive the currency notes that were demonetized in November 2016. In this article, we look at the disclosure required by all Companies in the Financial Statements pertaining to handling of the depreciated Rs.500 and Rs.1000 bank notes.Specified Bank Notes (Cessation of Liabilities) Bill, 2017
As per the Specified Bank Notes (Cessation of Liabilities) Bill, 2017, any person who is holding more than 10 banned notes of the Rs.500 or Rs.1000 currency is punishable with a fine of Rs. 10, 000 or five times the cash held, either of which is higher. Further, the Bill also mentions that an Indian citizen, who was outside India between November 9 and December 30 2016, will be entitled to tender the demonetized notes within the specified period.Mandatory Disclosure in Balance Sheet
As according the Specified Bank Notes (Cessation of Liabilities) Bill, 2017, the Ministry of Company Affairs released G.S.R. 308(E) on 30th March, 2017. As per G.S.R. 308(e), relevant to the Companies Act, 2013, the following is applicable for all Companies:- Every company will reveal the details of Specified Bank Notes (SBN) held and transacted during the period from 8th November, 2016 to 30th December, 2016 as mentioned in the notification. The financial statement of all the Companies for financial year ended 31.03.2017 must compulsory provide for the information along with closing cash in hand as on 08.11.2016, (+) Permitted receipts, (-) Permitted payments, (-) Amount deposited in Banks, Closing cash in hand as on 30.12.2016.
- The table for disclosure of old notes can be framed as follows in the financial statement:
Old Rs. 500 or Rs. 1000 Bank Notes | Other Denomination Notes | Total | |
Closing Cash in Hand - 08.11.2016 | |||
(+) Permitted Receipts | |||
(-) Permitted Payments | |||
(-) Amount Deposited in Banks | |||
Closing Cash in Hand - 30.12.2016 |
Disclosure in Auditor Report
All companies are mandatorily required to prepare and file audited financial statement with Auditors Report each year. As per MCA Notification No. G.S.R. 307(E) dated 30th March, 2017 there is an amendment in Companies (Audit and Auditors) Rules, 2014. As per the amended rules, Auditors are required to certify:- Whether the company had provided requisite disclosures in its financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and if so, whether these are in accordance with the books of accounts maintained by the company.
Related Guides
Popular Post

Starting a small business can be a transformative venture, offering the exciting opportunity...

Tax deduction at source, shortly and popularly known as TDS, was introduced by the Income Tax...

Goods & Services Tax Certificate is issued to people who are registered under GST...

GST registration applies to all individuals and entities supplying goods or services in India. GST...

Gift tax in India is applied when the value of the received gift exceeds ₹50,000 in the...

The Union Budget 2025 has brought significant changes to India’s personal income tax structure, raising the...

The Goods and Services Tax (GST) is an indirect tax system introduced in India in 2017. It functions...

A trademark search is simply checking if another person or organization does not already own the...

Section 194H of the Income Tax Act in India mandates the deduction of Tax at Source (TDS) on commission or brokerage...

Section 80G Deduction is a facility available in the Income Tax Act which allows taxpayers to...

The Income Tax Department (ITD) has not provided specific guidance on crypto taxes for Indian investors. However...

Internal audit applicability is a critical concept for companies in India, impacting various...

In the business world, two main types of companies exist: private company and public company...

Ministry of Finance vide a Notification No 05/2022- Central Tax (Rate) dated 13.7.2022 has issued...

The Central Board of Indirect Taxes and Customs (CBIC) has recently announced an extension...

Depreciation is a key concept in finance and accounting. It helps us manage how the value of...

Form 10IA of the Income Tax Department must be filed by taxpayers claiming income tax deduction...

The Goods and Services Tax (GST) system in India has been a significant reform in the country's...

India's Gross Domestic Product (GDP) benefits significantly from the substantial...

The Finance Act, 2023 introduced the MSME 45-day payment rule under Section 43B(h) of the Income Tax Act...

The Direct Tax Vivad Se Vishwas (DTVSV) Scheme, 2024, was announced by Union Finance Minister...