Balance sheet format, the Schedule III way.

What is the Schedule III balance sheet format?

A balance sheet is a snapshot, as of one date, of everything a business owns and everything it owes. Schedule III of the Companies Act, 2013 prescribes the layout Indian companies must present it in: a vertical format with two parts, one below the other, that must add up to an identical total —

• Equity & Liabilities — how the business is funded: Shareholders' Funds, Non-Current Liabilities, Current Liabilities.
• Assets — what the business owns: Non-Current Assets, Current Assets.

It replaced the older horizontal, T-shaped balance sheet. Proprietorships and partnerships aren't legally bound by Schedule III, but most are prepared the same way — it's simply the format banks, lenders and auditors expect to see.

Example: a worked balance sheet

Figures below are illustrative, as at 31 March 2026.

This is a static example to show the layout — TatvaBooks generates this straight from your ledger, not a template you fill in by hand.

Equity and Liabilities — how the business is funded

• Shareholders' Funds — Share Capital contributed by owners, plus Reserves & Surplus (accumulated profits retained in the business).
• Non-Current Liabilities — obligations due beyond 12 months, such as long-term borrowings and deferred tax liabilities.
• Current Liabilities — obligations due within 12 months: trade payables (money owed to suppliers), short-term borrowings, and other current liabilities.

Assets — what the business owns

• Non-Current Assets — property, plant & equipment, intangible assets and long-term investments held beyond 12 months.
• Current Assets — inventories, trade receivables (money owed by customers) and cash & bank balances, all expected to be realised within 12 months.

The current vs non-current split lets a reader judge short-term liquidity separately from the long-term financial structure — a business can be profitable on paper and still run into a cash crunch if current liabilities outpace current assets.

Why it must always balance

The balance sheet rests on one equation: Assets = Equity + Liabilities. Every rupee the business owns was funded either by its owners or by someone it owes money to — there's no third source. If the two totals don't match, it isn't a formatting issue; it means an entry is missing, misclassified, or unposted somewhere in the books. That's why "does it balance" is the first check any accountant runs.

Let your books generate the balance sheet — don't build it by hand

A balance sheet built in a spreadsheet, separately from your day books, is exactly where the two sides stop matching. When your books are maintained through proper double-entry accounting, the Schedule III balance sheet is a direct, always-current output — not a document you assemble at month-end. TatvaBooks (₹599/month on Business) generates it automatically from the same ledger as your invoices, expenses and GST — it always balances, because it's the same underlying data. See cloud accounting software and the full features list.

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