Financial Statement Preparation
We turn your year’s books into a finished balance sheet, profit and loss account, cash flow statement and notes, in the Schedule III format. For companies, the board must approve them before the audit, and the AGM must be held by 30 September.
What it is
Financial statement preparation is the year-end job of closing your books and presenting them as formal accounts. That means finalising the trial balance, passing year-end entries and laying out the statements with their notes.
For a company, Section 2(40) of the Companies Act, 2013 lists what the financial statement contains. Section 129 requires a true and fair view, the notified accounting standards and the Schedule III format. Financial statement preparation is an annual job, separate from day-to-day compliance and accounting management.
Who it applies to
You run a company
Every private, public and One Person Company prepares, audits and files them in Form AOC-4 each year, even with no business.
You run an LLP
An LLP files its statement of account and solvency in Form 8. Audit applies above ₹40 lakh turnover or ₹25 lakh contribution.
You run a firm or proprietorship
No ROC filing, but your ITR, bank and any tax audit need a balance sheet and profit and loss account.
Why it matters
Lets the audit start
The board prepares; the auditor audits. Under Section 134(1), the board must approve the statements before they reach the auditor.
Answers your bank and investors
Loan renewals, tenders and due diligence all start with your last audited accounts.
Feeds every tax and ROC filing
Your ITR, tax audit report and AOC-4 all draw from the same numbers. Get those wrong and every filing is wrong.
Documents required
Books and ledgers
- Tally, Zoho or other books up to 31 March
- Bank statements for every account
- Last year’s audited financial statements
- Fixed asset register
Year-end details
- Closing stock valuation as on 31 March
- Debtors and creditors lists with balance confirmations
- Loan statements and interest certificates
Tax and statutory records
- GST returns and the annual GST reconciliation
- TDS returns and Form 26AS / AIS
- Board minutes and related party details
What each entity needs
| Entity | Statements | Where they go |
|---|---|---|
| Company (most) | Balance sheet, P&L, cash flow statement, statement of changes in equity, notes | Board, auditor, AGM, AOC-4, ITR |
| OPC, small or dormant company | Same, but the cash flow statement may be left out | Board, auditor, ROC (AOC-4), ITR |
| Company with subsidiaries or associates | Standalone and consolidated statements (Section 129(3)) | Board, auditor, AGM, ROC |
| LLP | Statement of account and solvency | Partners, auditor if required, Form 8, ITR |
| Firm or proprietor | Balance sheet and P&L | ITR, bank, tax auditor where required |
Here is the catch with the small company exemption: a subsidiary of another company is never a small company, however tiny its own numbers. So a Faridabad family business that set up a separate company under its main company must include the cash flow statement. Larger companies also file in XBRL; see the FAQ below.
How it works
Close and reconcile the books
We reconcile bank, GST, TDS and party balances, then post depreciation, provisions, prepaid and outstanding expenses and closing stock. Stock causes most delays. If a trader counts it only in the first week of April, we roll the count back to 31 March using that week’s purchases and sales.
Draft the statements and notes
We regroup the trial balance into Schedule III heads and write the notes: accounting policies, related party transactions, contingent liabilities, and ageing of receivables and payables.
Get the board to approve and sign
The board approves the draft. It is signed by the chairperson if authorised, or by two directors, one of them the managing director where there is one, along with the CEO, CFO and company secretary where appointed.
See the audit through to filing
We answer the auditor’s queries and post adjustments. The statements then flow into your annual ROC filings and income tax return.
Timelines
Companies
AGM by 30 September, six months after year-end. AOC-4 within 30 days of the AGM. An OPC files within 180 days of the year-end, which is 27 September.
LLPs
Form 8, the statement of account and solvency, is due by 30 October for the year ended 31 March.
Tax audit and ITR (FY 2025-26)
Tax audit report by 21 October 2026 and ITR by 21 November 2026 for audit cases, after the CBDT extension of 28 September 2026. Non-audit firms and businesses file by 31 August.
What happens if you get it wrong or late
Section 129(7) for non-compliance
Breaching Section 129 exposes the managing director, CFO or finance director (or every director, if none is in charge) to up to one year’s imprisonment, a fine of ₹50,000 to ₹5 lakh, or both.
₹100 a day on late AOC-4
Late AOC-4 attracts an additional fee of ₹100 per day, with no cap. Section 137(3) adds a penalty of ₹10,000 plus ₹100 a day, up to ₹2 lakh for the company and ₹50,000 for each officer.
Section 134(8) for approval and signing lapses
Unapproved or wrongly signed statements: ₹3 lakh for the company, ₹50,000 per officer in default.
Frequently asked questions
What does a set of financial statements include?
For a company, it includes the balance sheet, profit and loss account, cash flow statement, statement of changes in equity where applicable, and the notes, as defined in Section 2(40). An LLP prepares a statement of account and solvency, while a firm or proprietor needs a balance sheet and profit and loss account. We prepare whichever set your entity needs.
Can our statutory auditor prepare our financial statements?
No, not for a company. Section 144 bars the statutory auditor from providing accounting and bookkeeping services to the company it audits. The board is responsible for preparing the statements, and the auditor gives an independent opinion on them. We prepare the statements and work with your auditor, so the two roles stay separate.
Does a small company need a cash flow statement?
No, Section 2(40) lets an OPC, a small company and a dormant company leave out the cash flow statement. Since 1 December 2025, a private company with paid-up capital up to ₹10 crore and turnover up to ₹100 crore counts as a small company, unless it is a holding or subsidiary company. Everything else in the financial statements still applies, including the notes and Schedule III format.
What is Schedule III?
Schedule III to the Companies Act, 2013 is the prescribed format for a company’s balance sheet and profit and loss account. Division I applies to companies following the Accounting Standards, and Division II to companies following Ind AS. We draft directly in the correct division, so the auditor works from a compliant draft.
When must a company file its financial statements?
Within 30 days of the AGM, in Form AOC-4 on the MCA V3 portal. The AGM itself must be held within six months of the year-end, so by 30 September for a 31 March year. An OPC, which holds no AGM, files within 180 days of the year-end, that is by 27 September. Starting the accounts in April or May keeps you well inside these dates.
Which companies must file financial statements in XBRL?
Listed companies and their Indian subsidiaries, companies with paid-up capital of ₹5 crore or more, companies with turnover of ₹100 crore or more, and companies preparing Ind AS financial statements. Banks, insurance companies, NBFCs and housing finance companies are excluded. Once a company starts filing in XBRL, it continues even if it later falls below the limits. If you are close to these limits, tell us early and we plan for it.
Do partnership firms and proprietors need financial statements?
Yes. There is no ROC filing, but Section 44AA of the Income-tax Act, 1961 requires books of account once income or turnover crosses the limits, and the ITR and any tax audit need a balance sheet and profit and loss account. For FY 2025-26, a tax audit applies above ₹1 crore of turnover, or ₹10 crore where cash receipts and payments are each within 5%. We prepare a firm’s accounts with the same care as a company’s.
How long must we keep the books behind the statements?
A company must keep its books of account for eight financial years under Section 128. If it uses accounting software, the software must record an audit trail of every change, and this cannot be switched off. Under the income tax rules, other businesses keep books for six years from the end of the relevant assessment year. We keep a full year-end file so you can answer any later query quickly.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
There is no government fee for preparing the statements. Filing them in AOC-4 costs ₹200 to ₹600, depending on share capital, plus ₹100 a day if filed late.
Ready to begin?
Send us your books up to 31 March. Our financial statement preparation puts a complete, Schedule III-ready set in your auditor’s hands.