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CS Professional · Banking and Insurance - Laws and Practice · Analysis of Financial Statements of Banks

Sahyadri Bank, a banking company in India, is preparing its annual financial statements. Its finance head asks which format governs the layout of the balance sheet and profit and loss account. Under the Banking Regulation Act, 1949, which schedule prescribes the forms for these statements?

The Third Schedule to the Banking Regulation Act, 1949 prescribes Form A for the balance sheet and Form B for the profit and loss account of banking companies, so banks follow it rather than the general Companies Act format.

  1. AThird ScheduleCorrect
  2. BFirst Schedule
  3. CSecond Schedule
  4. DSixth Schedule

Explanation

The Banking Regulation Act, 1949 prescribes the forms of the balance sheet (Form A) and profit and loss account (Form B) in the Third Schedule. The Companies Act Schedule III format is not used by banking companies for this purpose.

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