Balance sheet, P&L, cash flow

Category: Accounting & Bookkeeping. From ₹4,999. Typical timeline: 7–14 days.

Overview

Financial statement preparation converts a year's worth of recorded transactions into the balance sheet, profit and loss statement, and cash flow statement that lenders, investors, tax authorities, and regulators actually rely on to assess a business. Prepared in the Schedule III format prescribed under the Companies Act, these statements form the backbone of statutory audit, income tax filing, and any external fundraising or loan due diligence.

Who needs it

• Companies and LLPs preparing annual accounts for statutory audit and ROC filing
• Businesses applying for a bank loan or credit facility requiring audited or provisional financial statements
• Startups preparing financials for investor due diligence ahead of a funding round
• Proprietorships and partnerships needing financial statements to support income tax return filing

Eligibility

• Companies, LLPs, partnerships and proprietorships needing formal year-end financial statements
• Businesses required to prepare Schedule III-compliant statements for statutory audit or ROC filing
• Entities needing financial statements for bank loan applications, investor due diligence or tender submissions

Documents required

• Complete trial balance for the financial year
• Bank reconciliation statements for all accounts
• Fixed asset register and depreciation schedule
• Loan statements and confirmation of outstanding balances
• Inventory valuation details, where applicable
• Prior year financial statements for comparative figures

Process

1. Trial balance review — Verify the trial balance for completeness and correctness of ledger balances.
2. Adjustments and provisions — Pass year-end adjustment entries for depreciation, provisions, prepaid expenses and accruals.
3. Statement preparation — Prepare the balance sheet, profit and loss account and cash flow statement in Schedule III or applicable format.
4. Notes and disclosures — Draft accompanying notes to accounts and disclosures required under applicable accounting standards.
5. Review and finalisation — Circulate for management review, incorporate feedback and finalise for audit or filing purposes.

Government fees

• Government fee: Not applicable — statement preparation itself carries no government fee; ROC filing fees apply separately at annual filing stage

Professional fee

Professional fee starts at ₹4,999 for preparing a complete set of financial statements from a finalised trial balance, with pricing scaling for consolidation, multiple entities or complex adjustments.

Timeline

Financial statements are typically prepared within 7-14 working days of receiving a complete and reconciled trial balance; delays usually arise from pending bank reconciliations or missing supporting schedules.

Deliverables

• Balance sheet, profit and loss account and cash flow statement
• Notes to accounts and significant accounting policy disclosures
• Fixed asset and depreciation schedule
• Comparative statements against the prior financial year

Frequently asked questions

Do proprietorships also need Schedule III format statements?

Schedule III is mandatory for companies; proprietorships and partnerships typically use a simpler format, though many choose the same structured presentation for bank and tender purposes.

Can financial statements be prepared without a full audit?

Yes — statements can be prepared and even certified as provisional or unaudited for internal use or loan applications, with statutory audit being a separate, additional requirement for companies and certain other entities.

What is the difference between provisional and audited financial statements?

Provisional statements are management-prepared and unaudited, often used for interim purposes like loan applications, while audited statements carry an independent auditor's opinion and are required for statutory filings.

Common mistakes

• Finalising statements from an unreconciled trial balance, requiring rework once discrepancies surface later
• Missing depreciation or provision entries that materially affect reported profit
• Using an outdated or incorrect Schedule III format that omits mandatory disclosures
• Not maintaining comparative figures from the prior year, which is a mandatory disclosure requirement

Penalties for non-compliance

• Delay in finalising financial statements can cascade into late audit, late ROC filing and consequent additional fees and penalties
• Inaccurate statements can invite scrutiny during income tax assessment or bank due diligence
• Non-adherence to Schedule III format can result in audit qualification for companies

Legal references

• Companies Act, 2013, Section 129 and Schedule III — form and content of financial statements
• Income Tax Act, 1961 — requirement to file financial statements/computation with the return where applicable
• Accounting Standards (AS) / Ind AS as applicable to the entity